Back in 2019, mental health conditions affected one in ten people worldwide. This was in pre-COVID times: before the global health crisis, the successive lockdowns, the isolation, the economic hardship, the uncertainty and anxiety about the future, all of which have worsened the situation – yet mental health is not considered as a top healthcare priority in most places.

Mental health conditions are the main cause of disability and early retirement in many countries and a major burden to economies – costing trillions every year. Disability insurance claims experience shows that these conditions have been on the rise for more than a decade. The pandemic has been a catalyst and made it even more so visible that we face an upward trend, both in terms of the number of people affected and the related costs. Mental health awareness has grown as well, yet there is still much to be done to improve risk knowledge, assessment, and mitigation.

With this paper, we aim to shed light on the rampant, multi-faceted and often overlooked crisis that is affecting global mental health – with a focus on the potential implications on the insurance industry. Our goal is to provide a clear and up-to-date view of the challenges related to mental health, focused on the impacts on life and non-life insurance underwriting, claims, risk management, as well as on investments and operations.

More widely, mental health is increasingly recognized as a major societal issue. As such, it can be expected to garner more and more attention from the public and private sectors alike. Insurers will have to rise to the challenge and play their part in serving society’s evolving protection needs, while dealing with limited resources, shortages of trained professionals, lack of structured programs… To deal with mental health-related risks, and as it is often the case for emerging risks, collaboration among stakeholders and prevention will be key and may even lead to new opportunities for the insurance industry.

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