Nathan Baber, External Affairs Intern, Money and Mental Health Policy Institute
Event catch-up: launching new research on insurance and mental health
17 February 2023
Last week we launched our new report ‘Written Off?’ which highlights the issues that affect those of us with mental health problems when choosing, buying and using insurance products.
To mark the launch we hosted our first hybrid event, with attendees able to attend the event either in-person or online. We were fortunate to be able to host the launch at Which?’s central London office (and we are grateful to the Which? Fund for supporting this research with a grant).
The key findings
To begin, our Senior Research Officer and author of the report, Chris Lees, presented the findings of the research. He highlighted issues with how products are priced, explained and managed by firms – and how they can leave people worried about getting a fair deal, unclear on what they are covered for and struggling to make a claim. Many people with mental health problems face higher premiums, cover exclusions or complete declines from insurers once they’ve disclosed their condition.
Accompanying this, there is a lack of transparency from insurers concerning how they come to their decisions. This is contributing to low levels of trust in the industry. This means, in turn, that people with mental health problems fear disclosing their condition to insurers and worry that firms will increase their premiums or decline them cover.
Chris also talked about the mystery shopping exercise we undertook in the research, testing 15 travel insurance providers, including small, large and specialist firms. This process identified that a ‘customer’ with severe bipolar disorder was turned down by nine providers. When cover was offered, the price quoted was up toto 27 times higher than that quoted to a customer without a mental health problem.
The report’s recommendations
Following the findings, Chris explained the report’s recommendations. Firstly, we want the insurance industry to ensure that it is using accurate data, as well as providing greater transparency so customers know what information is used and how to challenge decisions.
We also called on the the FCA (which regulates financial services) to launch an investigation to examine the data and models firms use in pricing decisions to guarantee they comply with regulations and laws. This has to be accompanied by clear expectations for insurance firms to deliver fair value for customers with mental health problems.
The voice of lived experience
The event included a video interview from Emma, an expert by experience from our Research Community. Through the recording, Emma told the audience how, due to her disclosing her diagnosis of Bipolar Disorder to travel insurance providers, she saw her premiums skyrocket.
This left Emma upset and frustrated as after a lengthy process of healing she found herself healthy, and yet insurers still drastically increased her premiums when she disclosed her underlying mental health condition. Due to a lack of no other alternatives, Emma has now come to accept these exorbitant prices, yet she still feels she is facing stigma and unfair treatment from insurers.
From presentation to panel
Following Emma’s contribution, the event moved to a panel discussion. The panel was made up of a range of experts, including Chris, insurance professionals and regulators, with our Chief Executive Helen Undy acting as moderator. Each panellist was given the opportunity to share their thoughts as Helen and the audience provided relevant questions.
Joe Wilson from the Institute and Faculty of Actuaries acknowledged that transparency is very important when building trust with customers. Julie Higman, Income Protection Product Manager at Aviva UK, highlighted that financial difficulties and mental health are intrinsically linked. Mark Jones, Product Director at Legal & General, agreed, stating that the firm welcomes research of this nature as it helps inform effective change.
Mark continued to acknowledge that the industry is yet to fully solve this issue, but it is making positive steps to develop trust between insurer and customer. Jakob Strandgaard, Policy Adviser at the Association of British Insurers, reiterated these points, stating that a sense of injustice amongst customers with mental health problems was an issue.
This launch event provided an excellent opportunity to not only gain valuable insights into the issues affecting people with mental health when dealing with insurance firms, but also to hear from a range of experts who were able to provide further context.
It is a positive step to be able to have open dialogue with such a range of stakeholders. We hope that this only be the beginning of various productive relationships that will allow us to make sure people with mental health problems are teated fairly by insurers.
Catch up on the event below.
Read our full report – Written Off? – here.