‘Our ability to deal with mental illness is a long way behind’

Yet, according to MetLife UK, only 15 per cent of small and medium-sized businesses offer disability/income protection to their staff, a policy in which mental health is one of the most common claims. UK SMEs account for more than 95 per cent of firms.

Peter O’Donnell, chief executive of Unum UK and chairman of Unum Poland, says: “Our ability [as a market] to diagnose and deal with mental illness is a long way behind where physical illness has been, because we are just beginning to learn about it.

“[At Unum] the incidents of mental illness have risen significantly over the past 20 years. I suspect it was always there but people did not [talk about it] because they would be stigmatised.

"It is great that people are now talking about it, but there is a lot more that needs to be done.”

Where, historically, discussing mental health in the workplace was a taboo subject, that is changing. Working conditions have improved and employers are educating themselves more on how to spot the signs.

You need to have much more of a connection with your customer and you need to deliver services on an ongoing basis

Unum offers group protection insurance policies taken out by an employer for their employees, such as life insurance, income protection or critical illness. A significant amount of this business is sold through brokers. 

One of the things the insurer has been doing, to raise awareness and help remove the stigma associated with mental illness, is to run sessions between mental health professionals and employer clients and their staff.

Mr O’Donnell says: “People perceive insurance as something there to protect them when they need it. In today’s world that is not relevant enough. You need to have much more of a connection with your customer and you need to deliver services on an ongoing basis.”

To support its plans Unum also conducts research to spot where there are gaps. One of its recent studies looked at the demographic of people who used its rehab service in 2018 to return to work. The survey found that more people used this service for mental health issues than any other condition. 

And breaking down the research even further, Unum found that men made up 57 per cent of all cases using its return to work support for mental health – with the biggest rise among men aged under 30.

Knowing how to spot the signs early where an employee is struggling, or how to deal with the issue when it is spotted, can often be a challenge for employers.

Unum runs mental health workshops with line managers. It also works with charities to understand how employers can manage people with a serious illness and help employees deal with that illness, recovery and returning to work.

Increasing protection cover take-up

As awareness has grown over the years about the benefits of protection cover, so has its take-up. 

Swiss Re says the number of employees insured under group-risk policies sponsored by their employers increased by 3.3 per cent in 2018. But Mr O’Donnell says this is still not enough, particularly in the SME space.

Unum’s products in the UK are more prevalent with large employers than in the SME sector, an issue the insurer is trying to address. Mr O’Donnell says where larger employers might typically insure only around 10 per cent of their employees, because the products are perceived as expensive, with smaller employers they tend to insure all of their employees.

However, the take-up of Unum’s products with smaller businesses is only about 3-4 per cent. When Unum asked smaller businesses why they were not buying its products, it found that cost was the number one obstacle. It is also low on their list of priorities and they feel it is too long a commitment to be tied into.

Another complaint from small businesses was they felt they were never going to use the product, because the chances of making a claim would be low. 

Last year, Unum launched an employee-paid offering called Benni, which allows businesses to provide staff with direct access to a range of employee benefits alongside existing employer-paid options. It is also available as a standalone product.

The insurer has also launched an app called Help@Hand, which gives employees access to a range of services including a remote GP service and mental health support.

Unum is one of the biggest insurers in the group protection space, and one of its closest rivals is Canada Life. Other insurers vying for market share include AIG, Aviva and Legal & General. And most, if not all, are becoming more holistic in their approach to mental health as well as other needs.

“We would love new entrants. [Mental health] is greenfield and the more people in there, the more it helps the market,” Mr O’Donnell says.

“Group protection has been growing by about 3 per cent, but that is small. That is because [the market] needs to get more relevant. That is why we are doing things like opening up new types of distribution and looking at employee-paid products.”

He adds: “Brokers remain critically important to us. We are also talking to some other partners, like pension companies that have gone into the SME market. That’s an opportunity to get some cross-selling going.”

Ima Jackson-Obot is deputy features editor at FTAdviser and Financial Adviser