Mental health conditions a leading cause of permanent disability claims in SA – employers, govt must do more

Psychology-related disability claims are expected to continually increase over the next decade. Picture: Cottonbro Studio/Pexels

Psychology-related disability claims are expected to continually increase over the next decade. Picture: Cottonbro Studio/Pexels

Published Dec 6, 2023


Almost 20 percent of disability claims paid out by South African insurers is for mental health conditions, making this ailment the third highest cause of such claims.

Unaddressed mental health conditions also cost the South African economy approximately R160 billion per year.

From stressful life events and social issues to excessive social media usage and loneliness, there are multiple factors that can affect a person’s mental health and, ultimately, cause challenges both at work and at home.

More than one in eight people are living with mental health conditions, but Sinenhlanhla Sithomo, head of insurance business at Investec Life, says the complexity surrounding this illness – and the link to other physical conditions and symptoms, still disguises the true extent of mental health issues among the population.

“As such, we expect to see psychology-related disability claims to continually increase over the next decade.”

An analysis of the statistics from large South African insurers shows that claims for mental health conditions account for 18 percent of disability claims paid out and is the third highest cause of disability claims, just behind musculoskeletal and cancer claims, he says.

Investec Life is therefore encouraging South Africans to shed the stigma that surrounds mental health and take charge of their wellbeing by seeking treatment, particularly as conditions like anxiety and depression increase.

“There are multiple factors that can affect a person’s mental health, from stressful life events to internal factors like immunology and genetics. However, regardless of the underlying cause, we also understand that living with any mental health condition can cause challenges both at work and at home.”

Social issues such as crime, rising inequality, and the global geopolitical climate, characterised by wars, polarisation in world views, and multiple political crises, also add to the psychological and emotional strain we experience, Sithomo says. Mental health deterioration could also be attributed to factors like excessive social media usage, isolation, or loneliness.

These illnesses also carry “enormous economic consequences”, contributing to productivity losses in the workplace as well as exerting strain on the already pressured healthcare system.

“Health economists have estimated that unaddressed mental health conditions cost the South African economy approximately R161 billion per year while, globally, depression and anxiety alone cost the global economy nearly US$ 1 trillion according to the World Health Organisation (WHO).”

This, he notes, does not even take into account the indirect costs associated with these ailments.

“For example, major depression can also suppress appetite or result in overeating, which can then lead to conditions like diabetes and obesity. As such, while mental health issues are often the root cause of weight gain or ill-health, our healthcare systems treat the physical condition while often neglecting the underlying mental health issue.”

Given the precarious state of our mental health and the consequential knock-on effects for society, Sithomo says public and private sectors need to not only enhance efforts around mental health, but ensure support is given to people who want to take charge of their mental health and seek help.

This is happening globally, with more governments and companies realising the importance that mental health plays in achieving development goals. In fact, mental health is now included in the WHO’s Sustainable Development Goals (SDGs).

Key elements in achieving the SDGs related to mental health include transforming attitudes, actions and approaches to promote and protect mental health, and broaden access to treatment and care for those in need. Such a proactive approach and investing in initiatives that improve mental health are expected to deliver significant economic impact.

“While the costs associated with the deteriorating state of mental health are significant, companies stand to gain more value by giving employees the help they need, especially since effective treatment for many psychological conditions can be achieved within a relatively low cost.”

From a life insurance perspective, he says providing access to affordable and effective insurance cover for treatment is the starting point. Financial protection against the cost of lifestyle adjustment, as seen with any other disability, is important to recognise and provide appropriate cover for. Examples of such lifestyle adjustments could include costs for personnel support to take care of your family or paying off major debts – a mental health obstacle in itself.

In the event of a permanent disability, having a lump sum cover pay out helps with these lifestyle adjustments while an income cover pay out helps to continue paying for regular living expenses and offers you an opportunity to keep living a fulfilling life.

“To be fully supportive, life insurers can further encourage disclosures around mental health by taking into consideration aspects such as the social support structures individuals have in place to negate the premium loadings during the underwriting process.

“This is the bio-psychosocial approach to mental health needed in the life insurance industry.”

Providing disability cover as a standalone product without life cover is another important consideration that can broaden accessibility and financial protection against the effect of mental health conditions.

“Extending support to claimants goes beyond just paying out the cover at the claims stage. We should include providing support and counselling to those diagnosed with conditions like cancer or other critical illness, or supporting family members to cope during this period, so we can break the cycle of mental illness that is currently plaguing society,” Sithomo says.

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