Struggling with mental health? You can still get life insurance. Learn how insurers assess depression, anxiety, and other conditions—plus strategies for approval.
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How 15 common medical conditions affect life insurance premiums, underwriting, and coverage in Australia
If you have a mental health condition and you're researching life insurance, you may have encountered discouraging information online. Some sources suggest that any history of depression, anxiety, or psychological treatment will result in automatic decline.
This is not true.
The reality is far more nuanced: thousands of Australians with mental health conditions successfully obtain life insurance coverage every year. What insurers care about is not the diagnosis itself, but rather:
Mental health conditions exist on a spectrum. Someone with situational depression following a life event who responded well to short-term treatment is viewed very differently from someone with treatment-resistant bipolar disorder requiring multiple hospitalisations.
Understanding how insurers assess mental health - and preparing your application accordingly - can mean the difference between decline and approval at reasonable rates.
Mental health conditions are remarkably common in Australia:
These statistics come from Zurich's Cost of Care Volume 2 research and highlight an important point: mental health conditions are so prevalent that insurers cannot simply decline everyone who has ever experienced them. Instead, they have developed sophisticated underwriting processes to assess individual risk.
For detailed cost and prevalence data on specific mental health conditions, visit our Mental Health conditions hub.
When you disclose a mental health condition on your life insurance application, underwriters evaluate several key factors:
Not all mental health conditions carry the same underwriting weight:
Generally More Accepted:
Requires Careful Assessment:
Often Challenging:
Insurers view treatment positively - it shows you're actively managing your condition. They'll assess:
Any psychiatric hospitalisation significantly impacts underwriting decisions:
This is often the most important factor. Insurers want to know:
Someone working full-time with well-controlled anxiety presents a very different risk profile than someone who has been unable to work for 18 months due to depression.
The length of time since your last significant episode or treatment change matters greatly:
Prevalence: 1 in 6 women, 1 in 8 men lifetime risk
Recovery Statistics:
Typical Underwriting Outcomes:
| Scenario | Life Insurance | Income Protection |
|---|---|---|
| Single episode, stable 12+ months, working | 0-25% loading | 25-50% loading or exclusion |
| Recurrent depression, currently stable 12+ months | 25-50% loading | 50-100% loading or decline |
| Current episode, recently started treatment | Postponement 6-12 months | Decline |
| Multiple episodes, recent hospitalisation | Decline or 100%+ loading | Decline |
Key Success Factors:
For detailed information on depression costs and impact, see our Depression condition page.
Prevalence: 1 in 3 women, 1 in 5 men lifetime risk
Recovery Statistics:
Typical Underwriting Outcomes:
| Scenario | Life Insurance | Income Protection |
|---|---|---|
| GAD, stable on SSRI 12+ months, working | 0-15% loading | 15-25% loading |
| Panic disorder, controlled 12+ months | 10-25% loading | 25-50% loading |
| Multiple anxiety disorders, frequent GP visits | 25-50% loading | 50%+ loading or exclusion |
| Severe anxiety, unable to work | Decline | Decline |
Key Success Factors:
For detailed information on anxiety costs and statistics, see our Anxiety condition page.
Bipolar disorder presents more challenges than depression or anxiety, but coverage is still possible.
Typical Underwriting Outcomes:
| Scenario | Life Insurance | Income Protection |
|---|---|---|
| Bipolar II, stable 2+ years, working, no hospitalisations | 50-100% loading | Often declined or excluded |
| Bipolar I, stable 3+ years, employed, on mood stabiliser | 75-150% loading | Usually declined |
| Recent manic or depressive episode | Decline | Decline |
| Multiple hospitalisations in past 5 years | Decline | Decline |
Key Success Factors:
PTSD underwriting depends heavily on the cause and current functioning:
Typical Underwriting Outcomes:
| Scenario | Life Insurance | Income Protection |
|---|---|---|
| Single trauma, treated, stable 2+ years | 25-50% loading | 50%+ loading or exclusion |
| Complex PTSD, ongoing treatment, functional | 50-100% loading | Often declined |
| Combat-related PTSD, stable 3+ years | 50-100% loading | Usually excluded |
| Active symptoms affecting work | Postponement | Decline |
Key Success Factors:
Our specialist advisers work with mental health cases daily. Get honest assessment of your insurability before formal application.
Get Free AssessmentWhen you apply for life insurance with a mental health history, be prepared to provide detailed information. Gathering this documentation before you apply speeds up the process and demonstrates organisation.
Diagnosis details:
Treatment history:
Hospitalisation:
Crisis history:
Functional impact:
Current status:
Depending on your condition severity, insurers may request:
Pro Tip: Request a "medical report for insurance purposes" from your GP before applying. Having this ready can reduce underwriting time from weeks to days.
When you apply matters almost as much as what you disclose. Strategic timing can significantly improve your outcome.
Most insurers use 12 months as a benchmark for stability. This means:
If you're close to this threshold, waiting a few months can significantly improve your outcome.
This distinction is crucial: mental health affects these two insurance types very differently.
Life Insurance assesses mortality risk - will you die prematurely?
Income Protection assesses morbidity risk - will you be unable to work?
You may experience very different outcomes for each cover type:
Scenario: Well-controlled depression, stable 18 months, on SSRI
| Cover Type | Likely Outcome |
|---|---|
| Life Insurance | Approved, 0-25% loading |
| TPD Insurance | Approved, 25-50% loading, possible mental health exclusion |
| Trauma Insurance | Approved, mental health conditions excluded |
| Income Protection | 50%+ loading, mental health exclusion likely |
If your primary concern is protecting your family with a death benefit:
If Income Protection is essential:
This cannot be emphasised enough: full, honest disclosure is essential.
Non-disclosure is the single most common reason insurance claims are denied. When you make a claim, insurers have the right to:
If they discover you didn't disclose relevant information, they can:
You must disclose:
"I stopped taking medication, so I don't have depression anymore"
"It was just work stress, not real depression"
"That was 10 years ago and I'm fine now"
"My psychologist visits were for coaching, not mental health"
Disclosure doesn't mean presenting yourself in the worst possible light. You can:
Our advisers know how to present mental health histories in the best possible light while ensuring full disclosure. Free guidance available.
Talk to an AdviserIf possible, work toward the best possible mental health profile before applying:
Compile before applying:
An adviser experienced with mental health cases can:
Some brokers offer anonymous pre-submission to insurers (Stage 3.5 approach):
Sometimes the best outcome is approval with exclusions:
Underwriting approaches vary significantly between insurers:
Example: One insurer may decline someone with bipolar disorder, while another offers 100% loading.
Decline isn't necessarily permanent. You have options:
Request written explanation from the insurer. Was it:
Based on the decline reason, take action:
Different insurers have different policies. What gets declined at one may be accepted at another.
If fully underwritten cover isn't available:
An adviser experienced with declined cases can:
Yes. Taking antidepressants is common - about 1 in 8 Australians are prescribed them. Insurers will assess based on the underlying condition, stability, and how well controlled you are on medication. Many people on stable SSRI therapy are approved with minimal or no loading.
Seeing a psychologist or psychiatrist must be disclosed, but it's generally viewed positively. It shows you're actively managing your mental health. What matters more is the underlying condition and your current functioning.
Yes, you should disclose significant mental health conditions from any time in your life. However, conditions from many years ago that have been resolved are typically viewed much more favourably than recent issues. An episode of depression at 16 that resolved with treatment and hasn't recurred in 15 years would likely have minimal impact on a 31-year-old's application.
It's possible but more challenging than Life Insurance. Many people with stable, well-controlled anxiety or depression are approved for Income Protection, though often with:
Once your policy is in force, you cannot be declined or have your premium increased due to changes in your mental health (except for stepped premium increases based on age). This is why getting insurance while you're stable is so important - it locks in your coverage.
Not necessarily. Being stable on medication is often viewed more favourably than:
If you're stable on medication with no plans to change, that can be a good time to apply.
Most insurers require at least 12-24 months since discharge before they'll consider an application. Some may require longer for multiple hospitalisations or involuntary admissions. The longer ago the hospitalisation and the better your subsequent stability, the more favourably it will be viewed.
Mental health conditions are common, affecting millions of Australians. Life insurers have developed sophisticated approaches to assessing mental health risk, and many people with depression, anxiety, and other conditions successfully obtain coverage.
The key factors that determine your outcome are:
If you have a mental health condition and need life insurance:
Protection for your family is often still achievable - it may just require more careful navigation.
Our specialist advisers understand mental health underwriting. Get honest advice on your insurability and the best path forward.
Start Free AssessmentImportant Information
Cost estimates are from Zurich Cost of Care Volume 2 research and represent averages. Your actual costs may vary.
Insurance coverage recommendations are general in nature. This is general advice only and does not take into account your individual circumstances. Speak with a licensed adviser to determine appropriate coverage for your situation.
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