Health Risks

Insurability of mental health conditions – Innovative ideas afford new opportunities

Mental health conditions such as depression, schizophrenia and anxiety disorders pose special challenges in life insurance. Yet it is precisely this field that offers great potential, thanks to new approaches and fresh ideas, says Daniela Krause, a doctor specialising in psychiatry and a habilitated researcher in this field. She advises our clients in her capacity as Medical Consultant.


Psychiatry is a relatively young medical discipline. Can you give us a brief outline?

Daniela Krause: The first innovations in the field of mental health conditions date back to the beginning of the 20th century. Psychotherapy was the first form of care to take patients seriously, and they were no longer written off as insane like in previous centuries. In the 1930s, the therapeutic spectrum was expanded significantly, and new forms of treatment became available to people with mental health conditions, including artificial fever therapy (therapeutic malaria), insulin coma therapy (injection of a large dose of insulin) or electroshock therapy (triggering of an epileptic attack). Ever since Deutscher Ärztetag, the German Physicians' Congress, discussed the field of psychiatry for the first time in 1970, there has been a fundamental change of attitude. From a medical point of view, psychoses, anxiety disorders and depression are nowadays considered regular diseases with biological causes. We are just beginning to understand how to diagnose them at a cellular level. After all, psychiatric conditions – unlike other fields of medicine – cannot be diagnosed by means of blood tests or X rays.

What are the dimensions of mental diseases for insurers?

Mental health conditions currently constitute the most frequent cause of incapacity for work. In Germany, claims associated with mental illness account for 22% of all disability insurance losses. The insurance industry pays out billions of euros worldwide for people who are no longer capable of working in their chosen profession owing to a mental health condition. That is why disability insurance is concluded. In our view, however, it is important to improve the insurability of people with pre-existing psychiatric conditions. And of course insurers only want to pay benefits if the mental health condition is really serious. But this is not so easy to determine. 

Why is it so difficult to insure mental health conditions?

These conditions have a have a special place in medicine. Depression is not as easy to diagnose as heart problems or back pain. ECGs and X-rays helps physicians and insurers to assess health risks or confirm diagnoses. But there are no such aids in the case of mental health conditions, so insurers have to assess risks that are difficult to objectify. 

How does Munich Re approach this topic?

The symptoms of mental health conditions are still very difficult to evaluate from a risk assessment and claims handling point of view. It is therefore more important than ever for us to network with top psychological researchers and follow their innovations closely. That is wwhy we have significantly expanded our involvement: In 2016, our Medical Research & Consulting Centre of Competence launched a research partnership with the psychiatric clinic of Ludwig-Maximilians University (LMU) in Munich. In our first project in this context, we aim to make depression and schizophrenia diagnoses easier to measure and objectify. 

How can Munich Re help the insurance industry in this respect?

We advise our clients on all aspects of psychiatry, and we evaluate expert opinions and share the findings we have gained from our partnerships with top researchers. We want to provide our clients with a better understanding of how depression, schizophrenia and anxiety disorders can be identified and treated. And we want to offer them some competitive advantages. By understanding mental health conditions, they are better prepared for the future. 

What exactly is Munich Re doing?

Besides partnering with LMU, we are also collaborating with Munich Health, the Munich Re field of business that pools the international health know-how available in our Group. In addition, we are continually expanding our collaborations with mental health innovators. We are working in conjunction with a start-up company on innovative solutions for identifying mental health conditions at an early stage, and ensuring the best possible therapy. So far, the complexities of these conditions and their limited objectifiability have been the reasons why life insurers cannot always provide insurance cover. The insurability of people with pre-existing mental conditions could be improved by including smartphone data provided by them on a voluntary basis. 

What are your next steps?

We life insurers want to be even better partners for people with mental health conditions in future. I am building a network between our working groups and research and development projects with start-ups, universities and scientists, in order to develop new products and solutions for life insurers along the value added chain. After all, we would like to adapt innovations and promising research at an early stage, so that everyone in the insurance industry can benefit from these completely new cooperation partnerships between universities, start-ups and the insurance industry: Munich Re, life insurance companies – and patients.