Home / Insurtech / Workers' comp mental health costs next 'sleeping giant'
23 August 2021
Using artificial intelligence to “triage” workers’ compensation claims early can help address escalating costs and identify optimal pathways for insurers, employers and the statutory bodies operating Australia’s nine workers’ compensation schemes.
Insurance consulting firm Xceedance says workers’ compensation insurers are seeking experts to leverage technology to better connect with injured workers and increase their “self-service” with personalised treatment paths, in order to reduce claim costs.
More sophisticated data analysis can better identify potential claims and enable claims management to be “predictive rather than reactive,” Xceedance says.
The advice comes as worker claims for mental health injuries escalate, representing a significant expense for employers.
WorkCover Queensland recently told an Australian Insurance Law Association seminar that it saw an 8.8% increase in mental health claims last year, with payments up 37%.
Xceedance VP and Country Manager Australia and New Zealand Stephen Browne says there is an “uncounted cost of mental health” during natural disasters, including the COVID pandemic.
Many workers are sustaining psychological injuries as the pandemic affects their ability to return to their usual work environment, he says.
Insurers and employers need to analyse their workers’ compensation data to identify early triggers, particularly in high-risk occupations where employees operate heavy equipment in dangerous conditions, as well as employees in high stress roles such as paramedics, police, and firefighters.
“Such risks and costs could be the next sleeping giant,” Mr Browne said.
An increase in mental health workers’ compensation claims was evident before COVID but the pandemic exacerbated the negative development. Around 7200 Australians receive compensation for work-related mental health conditions annually - about 6% of all workers’ compensation claims in Australia, statistics from Safe Work Australia show.
Xceedance says many insurers are moving from legacy platforms to digital technology, enhancing claims management, and insurers must “interrogate their existing data” to understand the emerging COVID claim trends and recognise the limitations of their legacy systems.