Suicide and TPD claims at $350m

Suicide and total and permanent disablement (TPD) claims have totalled almost $350 million over a five year period between 2007 and 2011, research has found.

Non-profit mental health foundation SuperFriend, along with IFS Insurance Solutions, found suicide cost super funds’ insurers over $201.5 million at an average of $120,410 a claim, while TPD claims totalled $147.9 million, at an average of $82,960 per claim.

Titled the Super Mental Illness National Data (SuperMIND) project, the research examined claims related to mental illness, TPD and income protection, and suicide by age, gender and location, although the research does not go into why certain trends are happening.

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SuperFriend CEO Margo Lydon said giving participating funds customised reports that track their results against the benchmark can help funds pinpoint the problem areas such as age, gender and location.

Funds can then design early intervention strategies to lessen the financial and social effects of mental illness and support members.

“The SuperMIND research reinforces the reality that mental health and wellbeing is a risk management issue not just for super funds and their insurers but for government, employers and the broader community.” Lydon said.

“Mental illness-related claims are one of the few insurance claim types that a fund and their insurer can influence, lessen and ideally prevent if detected early.”

The research showed suicide claims for men peaked in the 39-44 age bracket, while TPD claims peaked for men in their mid-50s.

Suicide claims were high for women in their 40s and dropped off as they aged, but interestingly it peaked for women who were approaching their 70s.

Principal of group risk at IFS Shane Fielding said while there has been a lot of focus on the impact of increased claims on the cost of insurance within super – with premiums rising between 30 and 150 per cent – this is the first time data was benchmarked to spot trends and find solutions.

“While insurers do need to think about how they price their offer, product design and the claim process is equally as important when it comes to claims related to mental illness,” Fielding said. 

Six insurers teamed up with 13 funds and their administrators to analyse data from 4.1 million members.

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