Life Insurance Industry Productivity Commission response
Recently, SuperFriend coordinated and facilitated the Life Insurance Industry’s collaborative response to the Productivity Commissions’ draft report into the Inquiry into the Social and Economic Benefits for Improving Mental Health.
Our advocacy resulted in industry leaders, representing the following organisations, contributing to the drafting of a united submission: AIA Australia (which includes CommInsure Life), Financial Services Council (FSC), Hannover Re, MetLife, MLC Life Insurance, OnePath and Zurich, SuperFriend – Industry Funds’ Mental Health Initiative (SuperFriend), and TAL.
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The joint submission demonstrates SuperFriend’s ability to galvanise a collaborative industry consensus on mental health and position a response, including recommendations, to influence the Australian Government through this inquiry. Furthermore, SuperFriend also facilitated several industry meetings with Commissioner Dr Stephen King to amplify advocacy for the industry.
The submission and meetings highlighted the industry’s willingness, capacity and capability to be a valuable collaborator and stakeholder in achieving system reform. We reiterated that Life insurance, and the broader financial services industry, has a critically important role to play, which is different to Government(s) and other support agencies, in enabling improved mental health and wellbeing outcomes for all Australians. Through the provision of group life insurance, the industry enables a range of preventative strategies for workplaces and members – including mental health, financial health, wellbeing in retirement, rehabilitation and return to work.
Interestingly, the role of superannuation and life insurance had been an omission in the Productivity Commission’s initial Issues Paper (January 2019) and understated in their draft report (October 2019). Therefore, in the January 2020 industry submission we noted:
- Collectively, the life insurance organisations represented held 77 per cent of all in-force life insurance premiums for Australians.
- After Government, the life insurance industry is the largest financial (and other supports) contributor for people with a mental illness, paying over $700m in mental illness related claims in 2018 (versus $543m by workers compensation). Mental illness-related claims (primary cause of claim) is the second most common cause of claim overall; being the most common cause for Total and Permanent Disablement (TPD) claims and third most common cause for Income Protection (IP).
Furthermore, the industry now collects detailed up-to-date data on mental illness which, when compared or augmented with other large population-based data sources, could be immensely beneficial in identifying trends and addressing system reform for social and economic benefits.
Industry Recommendations – Summary:
- Inclusion of the life insurance industry’s substantive contribution and willingness to be part of the solution in improving the social and economic support of Australians with mental health conditions.
- Support for the life insurance industry to be able to fund Mental Healthcare – noting additional considerations. (PC draft recommendation 24.6).
- Government to fund the undertaking of a national population-based survey on mental health for data currency and to measure prevalence, diagnosis, service utilisation and outcomes. Government to also invest in the development of an open-source Australian Comprehensive Mental Health Condition Resource as a centralised, open-source resource covering symptoms, diagnosis, prognosis and treatment options (both clinical and non-clinical) (PC draft recommendation 25.2).
- Support by the industry to expand awareness training of Mental Illness in Insurance Sector – FSC Standard 21 – with proposed modifications that were detailed (PC draft recommendation 20.2).
- The Government to undertake a comprehensive evaluation and review of Better Access, MBS-rebated psychological therapy.
- Biopsychosocial approaches being more widely promoted and recognised as valuable adjuncts or alternatives to clinical interventions.
- Government led, fostered or recognised Coordination / Collaboration of Cross-sector working groups, to drive system wide change.
- Invest more broadly in Mentally Healthy Workplaces and seed-fund the implementation support of the National Workplace Initiative (PC Chapter 19 recommendations).
Through our advocacy, SuperFriend provided the industry with an effective platform to agitate for system change and reform. With the industry, we called on the Productivity Commission to expand Government(s) understanding about the entirety of the ‘system’ and the opportunity for genuine system reform for sustainable social and economic impact, by considering and articulating the substantive value that non-government ‘actors’ play in creating social and economic gains for Australia through reform.