Sarah Murphy, associate director for advice, information and training at Mental Health UK, said: "Mental illness shouldn’t be a barrier that prevents anyone getting the insurance they need.
"Our research found applying for insurance has often been a difficult and upsetting process to navigate for people who’ve experienced mental health problems, with over two thirds of people feeling they’ve experienced discrimination.
“Thankfully, change is on the horizon and we’re delighted to have supported the ABI to produce these new industry standards and to create the Mental Health & Insurance guide."
Also welcoming the announcement was Debbie Kennedy, director of protection at LV, who said: "Mental health issues are a growing problem and our research indicates that levels of stress and anxiety have risen since the start of the coronavirus outbreak.
"We expect this to manifest in increasing mental health disclosures for new applications and, over time, give rise to more mental-health related claims.
"The ABI’s Mental Health Standards initiative is welcome and will challenge and support us in making it easier for customers with existing mental health conditions to apply for and benefit from insurance. At LV=, this starts with how we ask the right questions."
Ms Murphy added that advice played an "absolutely crucial” role when accessing insurance for individuals with mental health conditions.
She said: "It’s quite easy when you are working in the sector to think ‘well it’s obvious what life insurance and critical illness is’, and throwing terms around like risk assessments.
"But it is not obvious to the general public so there is definitely an education piece and [a need for] clear information and advice about different products, their terms and conditions, what a risk assessment is and why it needs to be done.
"Another element of advice is getting the right product for you based on your particular circumstances and that’s where independent advisers in particular play a crucial role.
"I really encourage advisers to explore the market and [ascertain] which insurers can provide adequate cover for people with pre-existing mental health conditions."
Last week, Financial Adviser produced a CPD-qualifying Guide to Advising Clients in Mental Ill-Health. This can be found here.
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