Depression affects insurance premiums

2015-08-26 06:00


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DEPRESSION is one of the most commonly diagnosed mental health disorders.

According to the South African Depression and Anxiety Group (Sadag), it has been estimated that as many as one in six South Africans suffer from anxiety or depression.

Hayley Taylor of Hollard Life said only one third of those suffering from depression will get treatment.

“This is, in part, because a lot of people think of depression as a simple case of the ‘blues’. But it’s a serious illness that can interfere with your ability to function in your normal daily life, so it’s essential to seek medical help and support.”

Taylor said being diagnosed with depression also had the prospect to influence insurance or life cover.

“An insurance company will definitely want to know if you have been diagnosed with depression. But that doesn’t mean that you can’t get cover. It is very important to tell your financial advisor if you are or have been previously diagnosed with depression. When an insurer receives your application form, they use the information you provide to decide whether to offer you cover, how much cover to offer you and how much your monthly premium will be.

“It is essential that you tell your insurer everything about your depression from the very beginning, because giving incorrect or incomplete information when you apply could make it difficult for you when you try to claim,” she said.

According to Taylor, the insurers will consider the type of depression, the type of treatment that clients have had and how well clients managed it in the past.

The following information will be needed: date of diagnosis, method of treatment, past methods of treatment, doctor’s details, symptoms and dates of last symptoms, details of any previous hospitalisations, details of any suicide attempts and specifics of time taken off work as a result of the condition.

“Based on the information that you provide about your depression, an insurer may choose to charge you a higher premium.

“They may also apply what is called a ‘permanent suicide exclusion’, which means that they won’t pay out if you take your own life. An insurer may choose to apply a ‘depression exclusion’ on disability and income benefits because depression and associated conditions like chronic fatigue and fibromyalgia (a disorder that causes muscle pain and fatigue) can leave you unable to work for periods of time.

Some depression is temporary and happens as a reaction to a particular situation like the death of a loved one or having a baby (post-natal depression). This is called reactive depression,” said Taylor

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