For super funds and their advisers

Landmark study on cost to super of mental illness

Margo Lydon

(Pictured: Margo Lydon)

A landmark study by IFS Insurance Solutions in association with SuperFriend, the workplace mental health group, has provided the first comprehensive details of the aggregate costs to big super funds and their insurers associated with mental health issues, such as deaths by suicide and TPD and other insurance claims.

The study, called SuperMIND (Mental Illness National Data) involved analysis of five years of claims from 13 big funds and six group insurers, from 2007 to 2011. It showed that claims for death by suicide amounted to $201.5 million at an average of $120,410 per claim, and for TPD amounted to $147.9 million at an average of $82,960.

The results were presented last week at an AIST event on mental health and at a separate media briefing by SuperFriend chief executive, Margo Lydon, and IFS Insurance Solutions principal, Shane Fielding.

They showed some big differences in the insurance costs associated with mental illness and the number of claims between funds, between state regions, between the sexes and various age groups. The costs tallied, of course, did not reflect the enormous human costs associated with mental illness, Lydon said.

Lydon and Fielding were hopeful that further research would drill down and provide better information for funds and employers to help battle mental illness. The latest work incorporated benchmarking for funds to judge their members’ claims against others.

Some of the stark differences between funds and in the distribution of their aggregates included:

>  Suicide claims for individual funds ranged from 2-15 per cent of all death claims, averaging 10 per cent.

>  Suicide accounts for 26 per cent of all male death claims in the 25-34 age group.

>  But women accounted for 25 per cent of all TPD claims related to mental illness in the same age group.

>  Claims for suicide in total were about five times higher for men than women.

>  Victoria and Queensland had claim rates for suicide that were almost double the rates of the other states.

>  Victoria and Queensland also had significantly higher rates for mental illness-related claims for both TPD and income insurance than the other states.

>  The 55-59 age group was the only one where women had higher mental illness related income insurance claims than men.

As has been publicized elsewhere, suicide and other consequences of mental illness tend to be more prevalent in rural areas than the cities, however, Lydon said the differences between the states probably had several factors influencing the results.

The 13 funds, out of the 19 funds which are members of Superfriend, were anonymous for reporting purposes. But certain funds have gone public with their own problems in this regard in the past. For instance, TWU Super, representing truck drivers, found that loneliness and overwork was a contributor. At AMIST, meat workers often were isolated from their families too and worked in challenging conditions.

The SuperMIND results were gleaned from more than four million members, representing 38 per cent of the total male workforce and 36 per cent of the female workforce.

Superfriend, chaired by Damian Hill, the chief executive of REST, is funded largely by the major group insurers.

Subscribe to our Newsletter

IN Partnership

New on Investor Strategy News

Share on facebook
Share on twitter
Share on linkedin
Share on email