AIA Australia has called for life insurance companies to cover rehabilitation and medical treatment expenses, claiming that advances in treatments allow people to return to work sooner. The insurer has called for the government to change legislation that restricts life companies from contributing to medical and early rehabilitation expenses. Insurers are currently restricted to occupational rehabilitation rather than medical assistance.
Damian Mu, AIA Australia and New Zealand chief executive, said the insurer is focussed on driving sector reforms that benefit consumers and help people live longer and healthier lives. We recommend supporting programs seeking to return people to productive work, which research shows improves mental and overall health.
It has been demonstrated time and again that early intervention increases the likelihood of a person returning to work. Research shows a person’s chance of returning to work after 20 days off is 70 per cent, but this number drops the longer they are off work. After 45 days a person's chance of returning to work drops to 50 per cent and after 70 days reduces to 35 per cent.
Mu said advances in treatments and understanding workplace injuries have resulted in early intervention and assistance to gain better outcomes for injured workers.
Similar calls for change have been made by the Financial Services Council which stated in its PJC Inquiry into Life Insurance submission that its life members want to offer targeted rehabilitation payments for therapy or medical treatments that are determined relevant, necessary, and appropriate to assist the person in returning to work. If the restrictions were removed, insurers would be able to improve early claim intervention practices, which would increase the probability of a life insured’s successful rehabilitation and over time save the insurer money on long-term claims.