The Victorian Equal Opportunity and Human Rights Commission is aware of the issues Victorian consumers face in obtaining insurance and making claims, particularly those consumers with a disability such as a mental health condition. Under equal opportunity laws in Australia, insurers can’t discriminate against someone with a disability unless they can prove it would impose an 'unjustifiable hardship' on the insurer to avoid the discrimination, or, they have sufficient data or statistical information that warrants differential treatment.
However, some policies sold by insurers simply refuse cover for people with certain conditions, such as a mental health condition, with no regard to the severity of the condition or how long they have had it. These so called 'blanket exclusions' raise questions about whether they are supported by a rigorous evidence base. We’d expect to see information that showed relevant, specific conclusions drawn from quality research and analysis.
Armed with these concerns, in 2017 the Commission announced an investigation into the travel insurance industry to see how and why insurers deny cover and claims for people with a mental illness. As a part of our inquiry we are asking some of the major travel insurers to 'show us the data' and prove that they are complying with the law. Since the investigation commenced we have already seen a number of insurers change their policies. The full findings of the report will be released later this year.
The impact of insurance policies is evident in real experiences. In 2014 Melbourne teenager Ella Ingram planned to go on an overseas trip with her school but had to cancel at the last minute because of a mental health condition – something she’d never had before. Her insurer, QBE, denied her cancellation costs. After initially making a complaint at the Commission, Ella took the company to Victoria’s Civil and Administrative Tribunal and won. Her case revealed that the quality of data held by QBE to reject Ella’s claim was poor – far below what would be expected of one of Australia’s largest insurers. QBE produced data that was out of date, or simply didn’t add up.
While this case has been instrumental in highlighting the issue, it is not a new one. The Commission regularly hears from people denied insurance on the basis of mental health or another disability, and who face difficulty in obtaining recourse. Some people simply do not make a claim because of the might of the insurers they are challenging.
The business of insurance can be fraught, particularly when determining what price to put on a disability. Without proper attention and rigorous processes, insurance coverage can risk discriminating against the most vulnerable in our community: disadvantaged minorities, older workers, and those with chronic conditions.
People with disabilities make up approximately 18 per cent of Victoria’s population and this figure is increasing. In Australia, it's estimated that 45 per cent of people will experience a mental health condition in their lifetime. In any one year, it’s estimated that around 1 million Australian adults have depression, and over 2 million have anxiety, so the impact of these pricing decisions is felt deep and wide across Australia.
In a just society, differences in health and health risk should not be used as a basis for distributing opportunities, such as the opportunity to travel and see the world, or to have your family protected if something happens to you.
Our discrimination laws provide an important line in the sand; insurers cannot discriminate unless there is a good reason based on fact. These laws must be understood by corporates and companies who have duties to ensure they are operating lawfully in the services and products they sell. They also have obligations to be proactive about eliminating discrimination, as far as they reasonably can.
While the business of insurance focuses on pricing risk, insurers must treat customers fairly and lawfully. Along with race, gender, disability or age; a person’s health should not count against them without proper justification. Now, the Royal Commission’s hearings may illuminate another risk for insurers: the risk of not complying with our discrimination laws and the standards the community expects.
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