Our thoughts

The underwriting of mental health conditions has always been notoriously difficult. To properly assess such applicants an underwriter needs to look at the complete picture of not only the applicant’s health but also factors such as employment record and support network. But in these days of increasing automation, insurers are under increasing pressure to accept as many cases as possible through an automated process, driving up their straight-through processing (STP) rates and keeping costs down. An engine-based process involves only a few drill-down questions. But mental health risks tend not to lend themselves to this approach very well, if at…

Our companion article discusses concerns from various quarters about the way insurers handle mental health risks and some of the underwriting practicalities. What sort of magnitude of risk does mental illness present? We offer a handful of observations drawn from dozens of journal articles in our research library. There is plenty of evidence that, generally, mortality is elevated in mental illness. That it should be so in the more severe forms such as schizophrenia and bipolar disorder should be no surprise, but it is interesting to note that even milder conditions may present an extra risk. For example, in a…