A new assessment framework for mental health claims will be drafted following consultation with consumer advocates, medical specialists and other stakeholders, the Council of Australian Life Insurers announced today. 

The peak body says the industry action plan will set out minimum standards for “consistent, evidence-based thresholds” when assessing claims; clarify the purpose of disability insurance; and reflect contemporary medical evidence and return to work outcomes.

“We have listened to feedback from customers and consumer advocates who feel the claims process can be more transparent and easier to understand,” CALI CEO Christine Cupitt said. 

“Australia is in the middle of a national mental health crisis, and we need to set clear, evidence-based guidance about the support life insurers provide.”

The council says mental health conditions are the fastest-growing cause of life insurance claims.

“Insurers will always be there to help Australians with severe conditions that prevent them from working, but like the [National Disability Insurance Scheme] or workers’ compensation schemes, we can’t be the answer for every case,” Ms Cupitt said.

The council will establish an expert panel to provide technical advice on the framework, drawing on medical practitioners, legal specialists, rehabilitation and return to work experts, life insurance practitioners, and people with lived experience.

A three-month targeted consultation will be held early next year, engaging consumer representatives, mental health advocates, superannuation trustees, financial advisers and medical professionals.

CALI says work on the framework will run parallel to the independent review of the Life Insurance Code of Practice, led by Peter Kell, who will release a consultation paper on Friday. 

“The new framework will be informed by the outcomes of the life code review …  and CALI will engage with Mr Kell during its development.”