Insurers 'biased' against mentally ill

About one in three Britons will be affected by mental health problems

People with a history of mental illness are facing unfair discrimination from insurance companies, according to a leading charity.

The mental health charity Mind says it has been surprised to find that many people were denied insurance or had exemptions placed on them because they have a history of mental health problems.

The finding came as a result of a major report on general discrimination against the mentally ill.

A spokeswoman said: "We were quite shocked to find out how many people had not been given insurance and had financial problems because of their illness - even if it was 20 years since they last suffered a problem.

"This alerted us to the issue."

She said discrimination applied to all kinds of insurance - from travel insurance to life insurance for mortgage policies.

Ignorance

Part of the problem was due to ignorance about mental health.

"The companies want to cover their own backs, but it has gone way, way too far," said the spokeswoman.

"They often do not understand mental health problems or how common they are."

Mental health experts say one in three people will be affected by a mental health problem in their lifetime.

The spokeswoman added: "Some companies do not take into account that mental illness can be episodic. It can happen once and never again, such as a breakdown.

"But the stigma is so high that you are damned for ever more when you may be no more of a risk than anyone else."

She said insurance forms often had detailed questions about physical illness, but only one question on mental health.

This might be a yes/no answer over whether you have ever had a mental health problem.

"The discrimination is quite incredible. If you are honest, you are unlikely to get insurance and this may even apply to things like credit cards," she stated.

"If you break your leg 20 years ago, it is irrelevant, but that does not seem to be the case with mental health."

Holiday

She said one woman had contacted Mind after she was denied insurance for a holiday trip abroad.

She had just got over a depression and her doctor advised her that going on holiday would be a good thing.

But the Mind spokeswoman said the holiday company would not let her go because it was worried she would make the other tourists depressed.

The Association of British Travel Agents said travel insurance was based on "a calculated risk" based on medical evidence.

A spokesman said he thought a mental illness which dated back many years and was no longer a problem would be "irrelevant".

'Higher than average risk'

A spokesman for the Association of British Insurers said insurance companies based their risk assessments on reliable information.

"Insurance companies do not make rash judgements. They rely on up-to-date medical advice about mental health from specialists," he said.

Mind says some mentally ill people have been unfairly denied holiday insurance

He added that it was very difficult to diagnose the severity of a mental health problem.

It could range from a mild depression to schizophrenia, he said.

"If a person had a severe mental illness it could affect their risk and insurers would ask for further information."

He said it was not a question of a simple yes and no answer. If a person revealed they had a mental health problem which was serious, insurance companies would ask their doctor for more details.

They may need a specialist's report and medical examination to show that any treatment they had undertaken had been successful.

Insurers may also take into account the person's family history.

He said companies wanted people to take out insurance and were "reluctant" to put in exclusion policies.

Exclusion policies may exempt a person from obtaining full benefits from an insurance policy.

A risk assessment would have to include a statistical analysis that a person presented "a higher than average risk" since they could sue an insurance company under the Disability Discrimination Act if they unfairly declined insurance.

He added that only 5% of people were refused insurance or were given exemptions.

But Mind says people are reluctant to take out cases against big institutions and only a small handful of cases taken out under the Disability Discrimination Act were successful.

The government has promised to strengthen the legislation.