The number of life insurance clients disclosing a history of mental illness is on the rise, according to a new survey by AMP.

The survey says 71% of AMP’s financial advisers have clients making this disclosure, while 35% have clients who have revealed a history of mental illness when applying for income protection cover.

AMP Director of Wealth Protection Products Michael Paff says advisers are now taking mental illness into account when it comes to income protection cover.

“With one in five Australian adults experiencing a mental disorder in any year, and general awareness of mental illness increasing, advisers and customers are acknowledging the significant impact it can have on people’s lives,” he said.

“Advisers need to be flexible in engaging with their clients during the process of completing a personal health statement.

“This includes being able to recognise how comfortable the client is with personally disclosing potentially sensitive health history and looking at other options where available.”

But disclosure has not always helped the client gain income protection cover.

About a third of advisers surveyed had clients with disclosed mental illness obtaining income protection cover.

“The industry has worked hard to improve access to insurance for those with a history of mental illness,” Mr Paff said. “However, there’s still room for improvement on this important issue.”

Talking to an underwriter early in the application process did make a difference to obtaining cover, the survey found.

Advisers (18%) also said the client’s understanding of the impact that mental illness disclosure would make in the application did make a difference as to whether cover would be obtained.