In 2023/24, around 3.8 million people in England accessed National Health Service (NHS) mental health services – an increase of nearly 40% compared with pre-pandemic levels. An NHS-commissioned study from the Centre for Mental Health reported that in only one year in England, poor mental health is calculated to cost £300 billion, while a collective 18 million working days are lost annually, according to the Office for National Statistics’ sickness absence data. The mental health landscape has changed dramatically in the years following the pandemic, as individuals face the challenges of increased burnout, greater social isolation, and an unstable economic environment.

Mental health has moved from a peripheral concern in underwriting to a central, strategic focus

As a result, the degree to which mental health is considered in underwriting approaches has risen rapidly from a peripheral concern to a central, strategic focus. In the accident and health (A&H) insurance space, this evolution follows the broader societal transformation in how mental health is understood, discussed, and prioritised in its corporate context.

As underwriters, we are now being challenged to rethink traditional risk models, reassess exclusions, and innovate in ways that better reflect the realities of our world. The implications are far-reaching, impacting how insurers develop products, value pricing, manage claims, and effectively engage their customers. 

The changing mental health landscape

Mental health issues are no longer confined to the margins of healthcare. Depression, anxiety, burnout, and stress-related disorders are now among the leading causes of disability worldwide. According to the World Health Organization, the global prevalence of anxiety and depression increased by 25% in the first year of the pandemic alone, and new figures suggest these levels have remained high.

According to the Office for National Statistics, 22.6% of UK over-16s questioned between October and December 2024 reported experiencing high anxiety levels. This figure is higher than at any point between 2015 and 2019, when the proportion never rose above 21.3%, and sometimes dipped as low as 18.9%. For insurers, this surge has translated into a noticeable uptick in mental health-related claims. 

Historically, mental health was often excluded or narrowly defined in A&H policies – it was difficult to quantify and hard to verify. But that approach is no longer tenable. Clients – both individual and corporate – are now demanding more inclusive coverage.

Traditional risk models are being rethought, exclusions reassessed, and innovation demanded to reflect the realities of our world

Impacts on underwriting strategies

A variety of traditional buying motives have influenced underwriting strategies, including:

• Employee protection: policies are designed to provide protection for employees in the event of accidents, whether they occur at work, while travelling on business, or at home
• Business continuity: accidental death or injury can lead to financial loss, making it essential that business owners have cover in place to protect their employees to maintain productivity and minimise business interruption
• Compliance with duty of care: businesses have a duty of care for the broader safety of their employees while in the workplace, at home, or travelling on business, which includes their general wellbeing.

It is through this final lens that mental health-associated risks are now being viewed. This shift is being driven by some key developments:

• Better data, better decisions: advances in data analytics and digital health tools are giving underwriters more granular insights into mental health risks by providing data points that enable insurers to better understand risks. Wearables, telehealth platforms, and mental wellness apps are generating real-time data that can inform underwriting decisions in ways that were previously impossible
• Revised risk models: traditional actuarial models often fail to account for the complexity and variability of mental health conditions. Today, we are seeing the emergence of more sophisticated models that incorporate behavioural health indicators (such as an individual’s lifestyle), social determinants of health (economic and housing stability, level of community support), and even workplace culture metrics (burnout rates, employee engagement).

Evolutions in policies and claims

These shifts are leading insurers to think laterally to prevent damaging exclusions, revising policy wordings so they explicitly include mental health coverage. This includes expanding definitions of disability to encompass mental illness, removing blanket exclusions, and offering optional mental health riders. Some are even introducing standalone mental health insurance products.

A mentally healthy workforce is not just a moral imperative but a business necessity

The claims landscape is also changing. Mental health-related claims are becoming more frequent, but also more complex. They often involve longer recovery times, less predictable outcomes, and a higher degree of subjectivity than physical injuries. This requires insurers to adopt a more nuanced approach to claims assessment. This can involve closer collaboration with healthcare professionals, a greater emphasis on privacy and sensitivity, and the consideration of long-term support or rehabilitation rather than a single payout. In some cases, insurers may offer access to mental health resources or support services as part of the claims settlement, reflecting a broader shift towards holistic care rather than purely financial compensation.

The nature of mental health claims also means they frequently require more detailed supporting evidence, such as medical assessments, psychiatric evaluations, and ongoing treatment records, making the claims process more complex and sometimes lengthier.

Handling mental health-related claims often requires a different skill set compared with traditional claims. Claims handlers must be trained in understanding mental health conditions, demonstrating empathy, and recognising the importance of confidentiality. Enhanced communication skills, cultural awareness, and the ability to navigate complex medical information are increasingly vital. As the volume and complexity of mental health claims continue to grow, insurers are investing in specialist training and resources to ensure claims teams are well equipped to respond effectively.

Risk management

Corporate clients are playing a pivotal role in driving change. Many employers are now recognising that a mentally healthy workforce is not just a moral imperative but a business necessity. For example, 70% of employees said they would be willing to switch jobs for better benefits, according to Economist Insight research, while the Aflac WorkForces Report found that employees who feel supported with their mental health through workplace benefits are far more likely to report higher job satisfaction.

Group A&H policies that understand these demands are increasingly being designed with mental health in mind. Many now offer access to a wide range of personal support services, including counselling, practical resources, and information on topics such as work-life balance, stress, anxiety, bereavement, and workplace pressure, as well as flexible return-to-work programmes, and integrated wellness platforms that track mental wellbeing.

Behind every claim is a person navigating a difficult moment – we have a responsibility not just to assess risk, but to understand it

For underwriters, this means working more closely with HR teams, occupational health providers, and wellness consultants to design policies that are both comprehensive and sustainable.

The future of mental health in the A&H market

As mental health continues to move from the margins to the mainstream, the A&H insurance industry must keep pace.

This will require:

• Investment in digital tools that support mental health monitoring and intervention
• Collaboration with mental health experts to refine underwriting criteria
• Ongoing education for underwriters and claims professionals
• Regulatory engagement to ensure compliance and fairness.

Perhaps most importantly, it will require a cultural shift within the industry – one that embraces empathy, transparency, and innovation.

A human-first approach

At its core, this is a human story. Behind every claim is a person navigating a difficult moment. As underwriters, we have a responsibility not just to assess risk, but to understand it in all its complexity.

As mental health becomes a central pillar of A&H insurance, we have an opportunity to build products and systems that truly reflect the needs of the people we serve.