Often insurance companies do not seem to know how to deal with the complexities of mental health. They may say you present a high level of risk if you have or had a mental illness, and may not look at your individual circumstances.
You have rights if an insurance company rejects your claim, denies you cover or asks you to pay a higher premium because of your mental health.
What the law says
Commonwealth and state laws say that it is wrong to discriminate against someone based on a disability, which includes a mental illness. There are some exceptions.
An insurance company can only discriminate against you if their decision:
- is based on reasonable data or information, and
- is reasonable in all the circumstances – this may depend on the type of illness, how serious it is, how much it impacts you, and your treatment or recovery plan.
Even with these anti-discrimination laws in place, many insurance companies may not use the right data or consider all the relevant factors when dealing with people who tell them about their mental health.
Different types of discrimination by insurers
Discrimination by an insurance company can happen when:
- you tell an insurer about your mental health condition when you apply for cover and it refuses to insure you or charges you a higher premium
- you are offered insurance but on terms that mean you cannot make a claim about any mental health condition, not just the mental health condition you have been diagnosed with
- your insurer rejects your claim because it relates to your mental health
- your insurer cancels your policy because it believes you did not tell them about your mental health symptoms or condition.
Other support
Discrimination law is complex. It is important to get legal advice before lodging a complaint.
Victoria Legal Aid
If you live in Victoria, call us for free information about insurance discrimination, your legal options and how we can help you.
- Speak to us
- Get help in your language
- Support if you are deaf or find it hard to hear or speak on the phone
If we can’t help, we can refer you to other organisations that can.
Public Interest Advocacy Centre
If you do not live in Victoria, you can contact the Public Interest Advocacy Centre. The centre provides free legal advice and, if appropriate, representation in complaints about insurance companies denying cover or rejecting claims because of mental health.
beyondblue
If you, or someone you know, is experiencing depression or anxiety or just going through a tough time, you can call, chat or email from anywhere in Australia.
Find out more about beyondblue and Mental Health Australia’s program to reduce discrimination in for people with a history of a mental health condition.
Publications and resources
Disclaimer: The material in this print-out relates to the law as it applies in the state of Victoria. It is intended as a general guide only. Readers should not act on the basis of any material in this print-out without getting legal advice about their own particular situations. Victoria Legal Aid disclaims any liability howsoever caused to any person in respect of any action taken in reliance on the contents of the publication.
We help Victorians with their legal problems and represent those who need it most. Find legal answers, chat with us online, or call us. You can speak to us in English or ask for an interpreter. You can also find more legal information at www.legalaid.vic.gov.au
Reviewed 17 May 2022