Gen Re to develop mental health insurance product
Berkshire Hathaway’s global reinsurance subsidiary Gen Re has announced plans to develop an insurance product for managing mental health issues, beginning in South Africa.
The product has foundations in behavioral economics research: through active engagement with the managed services offered in partnership with their insurer, customers can control and improve their health and so change the underwriting decisions over the lifetime of their policy.
The key paradigm shift is the departure from the pure biomedical approach, which offers little granularity in the assessment and management of the risk, to a biopsychosocial approach. A multifactor risk tool, developed by the Gen Re team, considers psychosocial factors, as well as selected questions from the self-efficacy scale, in the terms offered. This more holistic approach translates into improved underwriting decisions and better terms for people with less severe mental illness.
The continuous underwriting approach also provides the opportunity for automatic reviews and re-underwriting, with the ability to offer expanded cover for mental health conditions over time. The effect is that customers will obtain increased levels of cover or a reduction in extra mortality loadings – in the presence of stable and well-managed disease.
While not all mental health conditions and events can be fully covered, the product aims to also provide cover for other unrelated events for individuals living with the condition.
“Research has shown that proactive and early intervention adopting the biopsychosocial approach across the mental health spectrum is a potential gamechanger. The focus is on keeping people well, intervening quickly when a change is triggered and working hard at the in-claim stage with structured rehabilitation, supported with tool sets, such as our Gen Re-developed Depression Tool. Initial feedback from our recent CONNECT client event has been overwhelmingly positive and we are excited about working together with our clients to meet the specific needs of their customers.” – Gen Re’s Thea Weyers, who led-the Cape Town team responsible for developing the product.
Clients will also benefit from access to Gen Re’s growing network of health tech specialists operating in the mental health space, as they develop their own custom structures from this unique scaffold.