The rate of psychological injury claims among workers is increasing, with almost a third of all COVID-19 related claims lodged with icare related to mental health, the NSW state insurer says.

Psychological injury currently accounts for only around 6% of all workers’ insurance claims handled by icare, but the rate is increasing.

The finance and insurance sector experiences the greatest percentage of mental health claims, at more than a quarter of the total.

Icare says 161-related COVID-19 claims were lodged by June 22, with 45% for exposure only and 25% for contracting the virus.

“The high rate of psychological claims is an indication that employers should continue to consider how mental health is managed in the workplace,” icare says.

The insurer has created an employer toolkit, as well as a new checklist to help employers to optimise mentally healthy work practices in environments outside the traditional office, such as working from home arrangements.

Healthcare organisations, retailers and their supply chains, police and ambulance and other emergency and frontline workers may be at most risk of psychological distress from the virus.

Mental health claims, on average, experience a longer time off work and are more complex to manage than a physical injury.

icare says early access to treatment for a psychological injury supports better long-term outcomes and the insurer is conducting a pilot study in collaboration with researchers from Griffith University on the use of mediation in the management of mental health claims.

"Unlike most physical injuries that require little or no time off work and can be well managed with a light touch approach, psychological injuries require greater input and guidance from a case manager to help a worker through the claims process," Group Executive Personal Injury Elizabeth Uehling said.