Proportion of income claims for mental health issues ‘doubled in 2020’

The proportion of income protection claims triggered by mental health issues doubled in 2020 amid the coronavirus pandemic, according to an insurer.

More than one in four (27%) such claims were triggered by mental health conditions last year, compared with 13% in 2019, making it the most common cause of claim, according to data from Zurich.

It released the findings ahead of Mental Health Awareness week from May 10 to 16.

Around £1.7 million of payments were made to individual policy holders who claimed. Some sought clinical support as part of their policy for conditions including depression, stress and anxiety, Zurich said.

The firm also said that 28% of new group income protection claims last year were for mental illness, making it the second most common reason for people seeking support, after cancer.

This is cover provided by an employer as part of an employee’s benefits package.

Nicky Bray, Zurich’s chief underwriter for its life business, said: “We know around one in four of us will experience a mental health problem at some point in our lives, which means it is vital that products such as life and income protection insurance are available to as many people as possible.

“To help boost uptake, we continually look to simplify the application questions and only request further information when needed to give a fair decision, making the process of buying life insurance easy to understand and quick to apply for.

“We are also progressing various initiatives as part of our work with the ABI (Association of British Insurers) on the mental health standards for the industry.”

Insurer AIG Life Limited also said it had experienced a growing demand for private services to help people with mental health issues. It said young people in particular were seeking help.

AIG said demand was rising for mental health help among members of group risk schemes via its well-being service, Smart Health by AIG, a digital healthcare service.

It said demand for appointments with mental health psychologists leapt in the first three months of the year.

Lee Lovett, managing director, group protection at AIG Life, said that as lockdown restrictions eased, “many will have been psychologically scarred by the fear and worry of the pandemic”.

Mr Lovett said: “This will have left people’s emotional resilience for coping with the new thought of contact risks significantly reduced.

“This could manifest as fears for the commute, for sitting in the office space, for venturing into built-up, heavily populated areas again, and leaving behind the one constant that has provided security – home.

“We should expect that people are going to feel anxiety and need mental health support.”

AIG’s usage data showed younger people and women were most likely to ask for help. Over half (57%) of those seeking Smart Health mental health and psychologist consultations were aged 18 to 35 and 5% were under 18, while 63% of psychology service appointments were for women.

Research commissioned by AIG Life found one in four (25%) adults wanted some training to help others and identify the signs of mental health issues in themselves.

Some employers were already addressing the need for training, it found, with around one in five (18%) employees saying they had had training through work. A further 13% said they had gone online to find out more about mental health issues.

Alison Esson, propositions manager at AIG Life, said: “Attitudes to mental health have changed massively, especially in the last year, and people are much more aware of the risks to themselves and others.”