Guidelines for Providers of Insurance and Superannuation

Guidelines for Providers of Insurance and Superannuation

2005 Version

1.Introduction to these insurance and superannuation guidelines

2. Who is protected by the DDA?

3. Discrimination

3.1 Types of discrimination

3.1.1 Direct discrimination

3.1.2 Indirect discrimination

3.2 Does the DDA apply to policies entered into before 1993?

4. The insurance and superannuation exemption

4.1 Does section 46 exempt all insurance and superannuation from the DDA?

4.2 What does section 46 say?

4.3 Who has the burden of proof under section 46?

4.4 What is reasonable?

4.5 Is actuarial and statistical data always required?

4.6 What data is reasonable to rely on?

4.6.1 Underwriting manuals

4.6.2 Local data

4.6.3 Use of overseas studies

4.6.4 Relevant domestic and international insurance experience

4.7 Other relevant factors

4.7.1 Medical opinion

4.7.2 Opinions from other professional groups

4.7.3 Actuarial advice or opinion

4.7.4 Relevant information about the individual seeking insurance

4.7.5 Commercial judgment

5. Denying cover and alternative means of managing risk

5.1 Difficulties in using exclusion clauses regarding existing conditions

6. Unjustifiable hardship

7. Case examples

8. Information for respondents to complaints

1. Introduction to these insurance and superannuation guidelines

The Commonwealth Disability Discrimination Act 1992 (the "DDA") aims, as far as possible, to promote the rights of people with a disability to participate equally in all areas of life. It does this by making it unlawful to discriminate against a person with a disability, subject to a number of exceptions intended to balance the rights of people with disabilities with those of other persons.

The areas where discrimination is unlawful include insurance and superannuation.

Coverage by the DDA is very broad: it includes all forms of general, health and life insurance issued by registered insurers and includes underwritten and non underwritten applications and policies issued by insurers.

However, the DDA contains important exceptions for distinctions which are reasonable.

The DDA gives the Human Rights and Equal Opportunity Commission power to make guidelines to assist better understanding of rights and obligations under the Act.

These Guidelines are not regulations and are not binding in their own right. They provide the Commission's views on the interpretation of the DDA and information on how it has been applied in cases in practice. A person who acts inconsistently with these Guidelines may be acting unlawfully under the DDA. Acting consistently with these Guidelines may assist in avoiding unlawful discrimination.

These guidelines are intended to:

• clarify the difference between lawful and unlawful disability discrimination in providing insurance and superannuation; and
• help providers of insurance and superannuation in complying with the DDA, in making decisions in individual cases and in developing broader policies and procedures; and
• explain what distinctions or exclusions may be reasonable in offering insurances to people with a disability, and
• explain factors that courts may take into account in deciding a complaint about disability discrimination.

2. Who is protected by the DDA?

"Disability" has a very broad meaning in the DDA and includes:

• physical disability
• intellectual disability
• psychiatric or psychological disability
• sensory disability
• neurological disability
• learning disabilities
• physical disfigurement, and
• the presence in the body of disease causing organisms (such as hepatitis C or HIV).

It includes a person with one disability as well as someone with more than one disability. It applies whether the disability is total or partial and whether the person:

• currently has a disability
• has had a disability in the past (for example, if a person is a cancer survivor or has had a past episode of mental illness)
• may have a disability in the future (for example, if a person has a family history of, or genetic indicators for, a disability which a person may develop in the future) or
• is imputed as having a disability (for example, if a person is thought to have HIV/AIDS because of appearance, lifestyle, or association with people with HIV/AIDS).

The DDA also covers discrimination against a person because he or she is an associate of a person with a disability: for example, a family member or partner, friend or carer.

Anyone in the community may experience disability at some time in life. Australian Bureau of Statistics figures indicate that 18 per cent of the Australian population, or more than three million people, have one or more disabilities; and that this proportion is increasing, in particular with the ageing of the population.

Detailed and accurate figures on the numbers of people with particular disabilities are not always easy to obtain. However, here are some estimates:

• Mental disorders / psychiatric disabilities: Around 1 in every 5 Australians, or over 3 million people, experience a mental disorder of some kind, with 170,000 experiencing at least one schizophrenic episode and up to 10 per cent experiencing depressive disorders (figures cited in the Commission's National Inquiry into the Human Rights of People with Mental Illness, 1993) including 10% of mothers experiencing postnatal depression (W.A. Disability Services Commission, "Disability Counts", 1997)
• Physical disabilities: 14 percent of the community, or around 2.6 million Australians, have a physical disability of some kind (Australian Bureau of Statistics figures). This includes, for example, people with respiratory disorders such as asthma; people with neurological disorders such as MS, cerebral palsy or epilepsy; people with muculoskeletal disorders such as arthritis or spinal injuries; people with immunological disorders such as HIV/AIDS; as well as people with other disorders such as diabetes, kidney disease, or cancer.
• Sensory disabilities: Over 1 million Australians have a significant hearing impairment, with around 30,000 Australians totally deaf. Around 300,000 Australians have a substantial vision impairment (i.e. not correctable by glasses), with around 20,000 totally blind (Commonwealth Disability Strategy figures)
• Intellectual disabilities: Around 2 percent of the population, or 400,000 Australians, have an intellectual impairment (Definition and Prevalence of intellectual disability in Australia, Aust. institute of Health and Welfare, 1997)
  
  See the Australian Bureau of Statistics publications Health status: disability amongst adults 2001; Disability and Disabling Conditions and Disability and Handicap Australia .

There are many different kinds of disability and a wide variety of situations people experience.

• The disability may be permanent or temporary.
• It may exist from birth or be acquired later in life.
• A person may have one disability or a number of disabilities.
• A person may be treated as having a disability when in fact he or she does not.
• A person's disability may be apparent, such as loss of a limb; or hidden, such as epilepsy or a depressive illness.
• Disability may be more or less severe in its impact.
• People with the same disability are as likely as anyone else to have different abilities.

3. Discrimination

Section 24 of the DDA makes it unlawful for anyone who provides goods, services or facilities to discriminate against a person who has a disability (or is an associate of a person with a disability). This includes provision of insurance and superannuation.

Subject to the exception in section 46 specifically in relation to insurance and superannuation, and subject to the more general defence of unjustifiable hardship under section 24 itself, section 24 makes unlawful

• discriminating by refusing to provide services
  
  (For example, complaints have been made where insurance has been refused because a person has had a depressive illness, or has a vision impairment, or has quadriplegia, or has cancer or had cancer in the past).
• discriminating in the terms or conditions of provision of services;
  
  (For example, complaints could be made where insurance is only provided to a person with a disability at a much higher premium or after a longer waiting period than applies to persons without the disability - subject as noted to the defences of unjustifiable hardship under section 24 and reasonableness under section 46)
• discriminating in the manner that services are provided.
  
  For example, as with any service provider, it is unlawful for a provider of insurance or superannuation to fail to make its information on products equally accessible to people with a disability when required. This may include provision of material in electronic or other appropriate formats for access by people who are blind or have a vision impairment or other print disability; or provision of materials in plain English or with additional explanation where required by a person who has an intellectual disability or brain injury.

These guidelines only discuss in detail issues arising under the first two of these points, rather than features such as accessible premises and communication which apply to service provision more generally. To address these more general issues, providers may wish to consider adopting an Action Plan under the DDA. Guidance material on developing action plans, and hundreds of action plans already adopted by other organisations, are available through the Australian Human Rights Commission website, at http://www.humanrights.gov.au/disability_rights/action_plans/index.html .

3.1 Types of discrimination

3.1.1 Direct discrimination

Direct discrimination occurs where a customer with a disability is treated less favourably than a customer who does not have a disability would be treated in the same or similar circumstances.

This means treating a person with a disability in a way that is different from the way a person without the disability is treated or would be treated, and which disadvantages them.

For example: It would be direct discrimination to refuse to insure someone because he or she is blind. This will be unlawful discrimination except in circumstances where the exemption in section 46 applies.

3.1.2 Indirect discrimination

The DDA also covers indirect discrimination. This occurs where the same rule, condition, requirement or practice is applied to people whether or not they have a disability but where the effect is to unreasonably exclude or disadvantage people with a disability.

For example: Requiring all applicants to show a driver's licence for identification indirectly discriminates against anyone who is unable to drive because of a disability.

3.2 Does the DDA apply to policies entered into before 1993?

Discrimination in insurance and superannuation happens at the time of the particular act complained of - which may be a refusal to provide cover but may also be a subsequent refusal to pay a claim. The date of the insurance contract, insurance policy or superannuation policy will not necessarily be decisive. It will depend on the circumstances of each case.

For example: A customer signed a contact of insurance in 1990 containing a HIV/AIDS exclusion clause. If an insurer refuses a claim in 2004 on the basis of the exclusion, this refusal will be covered by the DDA even though the contract was signed before the DDA came into force.

4. The insurance and superannuation exemption

Most types of insurance involve differentiation between people on the basis of assessments of risk, which may depend in part on a person's disability in some cases.

(Health insurance, where the "community rating" principle applies, is a partial exception, but even here insurers are permitted to, and commonly do, differentiate between different risks by applying waiting periods for insurance of pre-existing conditions, and by only including coverage for some treatments in more expensive packages.)

Section 46 of the DDA contains a specific exemption for the insurance and superannuation industry in recognition that some discrimination is part of the nature of most types of insurance in Australia.

This is in addition to the defence of unjustifiable hardship available to service providers generally under section 24.

In many cases the effect of the two defences may be the same, but in other cases the difference between the two defences may be important.

A large and profitable insurer might suffer no significant impact, let alone unjustifiable hardship, by being required to insure a person with a very rare disability on terms more favourable than a reasonable assessment of risk and uncertainty would indicate, and might not thus be able to raise the general defence under section 24, but could still rely on the more specific exception in section 46.

Conversely, an insurer might seek to rely on the unjustifiable hardship defence in circumstances where the specific exemption in section 46 does not apply. Section 46 contemplates an individualised assessment of risk in relation to available data and other relevant factors. In relation to some products and circumstances an insurer might seek to argue that such an assessment is not economically viable and would impose unjustifiable hardship.

4.1 Does section 46 exempt all insurance and superannuation from the DDA?

No. Discrimination in access to insurance or in the terms on which insurance is available is covered by the DDA. There is an exemption only for decisions or restrictions which are reasonable, including reasonable decisions on the basis of actuarial or statistical data where this is reasonable available.

4.2 What does section 46 say?

Section 46 provides that discrimination in insurance or superannuation is not unlawful if the discrimination:

• is based upon actuarial or statistical data on which it is reasonable to rely; and is reasonable having regard to the matter of the data and other relevant factors (s.46(1)(f); or
• in a case where no such actuarial or statistical data is available and cannot reasonably be obtained - the discrimination is reasonable having regard to any other relevant factors (s.46(1)(g).

4.3 Who has the burden of proof under section 46?

In most respects, a person claiming unlawful discrimination bears the burden of proving it if the matter goes before a court. However, the Federal Court decision in QBE Travel Insurance v Bassanelli confirms that the insurer bears the burden of showing that the section 46 exemption applies, rather than a complainant having to demonstrate that the exemption does not apply.

4.4 What is reasonable?

As noted by the Federal Court in the Bassanelli case:

to be eligible for protection under s 46(1)(f), it is also necessary for the discrimination to have been reasonable having regard to the data and to other relevant factors. That clearly also involves an objective judgment. It is a judgment to be made objectively with the knowledge and in the circumstances of the discriminator, but including factors of which the discriminator ought to have been aware.

Whether particular decisions are reasonable will require case by case assessment of those decisions. These Guidelines cannot guarantee that decisions based on particular types of data will or will not always be reasonable.

Matters taken into account include:

• practical and business considerations
• the nature of the risk being considered
• all other relevant factors of the particular case and
• the aims of the DDA, especially the aim of eliminating disability discrimination as far as possible.

Relevant factors include both those that may increase risk and those that may reduce it.

For example, it may be relevant to look at information on whether a person is or is not receiving effective treatment for a condition such as a mental illness, so as to reduce risks associated with the condition.

The Federal Court commented on the meaning of reasonableness in antidiscrimination law as follows in Secretary, Department of Foreign Affairs and Trade v Styles (1989) 23 FCR 251 at page 263:

The test of reasonableness is less demanding than one of necessity but more demanding than one of convenience… The criterion is an objective one which requires the court to weigh the nature and extent of the discriminatory effect on the one hand against the reasons advanced in favour of the requirement or condition on the other. All the circumstances of the case must be taken into account.

When assessing the risk associated with certain disabilities, insurers may have to rely on imperfect data.The reasonableness of a decision to refuse cover or apply an exclusion or higher premiums will be judged according to the information which existed and was reasonably available at the time when relevant decisions had to be made, not according to later changes in circumstances.

For example: In Xiros v Fortis Life Assurance Ltd [2001] FMCA 15 the magistrate found that it had been reasonable to apply HIV/AIDS exclusion clauses in the insurance component of superannuation policies between 1991 and 1996 because of risks of anti-selection, and that actions of the insurer in that case should be measured against the circumstances applying at the time rather than against the changed circumstances of 2001.

This principle will operate differently in relation to different types of insurance because in some areas, particularly life insurance, decisions have to be made once and for all which will operate into the future, since policies once issued cannot be cancelled due to later changes in circumstances. In other types of insurance there are opportunities to review coverage and premiums as circumstances change.

But it will not be reasonable to discriminate on the basis of incomplete information if better information could reasonably have been obtained. In particular, insurers should seek to ensure good communication with people who are insured or seeking insurance, so that information is brought out which might reduce or eliminate the need for a discriminatory decision.

The DDA does not directly require insurers to give reasons to customers for decisions (except once a complaint is lodged), but clear communication about concerns and about reasons for decisions may help to avoid unlawful discrimination, and also avoid complaints resulting from misunderstandings about justifiable decisions.

4.5 Is actuarial and statistical data always required?

Discrimination does not have to be based on actuarial and statistical data to be covered by the section 46 exemption. If no actuarial or statistical data is available, or no data that it is reasonable to rely on, and no such data can reasonably be obtained, an insurer or superannuation provider can seek to show that the discrimination is reasonable having regard to other relevant factors.

But (as explained by the Federal Court in the Bassanelli decision and as is clear from the terms of section 46) if actuarial or statistical data that it is reasonable to rely on is available, or could reasonably have been obtained, and is relevant to a decision, the section 46 exemption will not apply unless the decision complained of is based on that data and is reasonable.

4.6 What actuarial or statistical data is reasonable to rely on?

In the Bassanelli case the Federal Court noted that this issue

"involves an objective judgment about the nature and quality of the actuarial or statistical data relied on. The actuary or statistician (or the data itself) may indicate that for whatever reason it would not be reasonable to rely upon it. It may be qualified, or be an insufficient sample for reliable use, or not be directly applicable to the particular decision. There may be other reasons why, on its face, it would not be reasonable to rely upon it. There may be actuarial or statistical data upon which it may be unreasonable to rely for other reasons external to the data being relied upon. The data may be incomplete, or out-of-date, or discredited, and the decision-maker ought, in the circumstances, to have known that."

As indicated by the Court in this case, a decision will not always be accepted as reasonable simply because it is based on actuarial or statistical data. The data must be reasonable to rely on and the decision itself must be reasonable. Insurers should be prepared to explain the basis of decisions including the limitations of information reasonably available.

4.6.1 Underwriting manuals

It will often be reasonable and necessary as a commercial matter for insurers to use manuals which include detailed information about and assessment of the nature and degree of a disability related risk.

As indicated by the Federal Court in the Bassanelli case, however, the courts may be prepared to examine whether data in underwriting manuals is reasonable to rely on, including whether data is reasonably complete and up to date. Manuals should be based on relevant actuarial or statistical data or medical opinion and updated as necessary to take into account advances in medical knowledge, rehabilitation and treatment, adaptive technology or other areas affecting the level of risk or loss associated with a particular disability.

This does not mean that information in manuals has to be shown to be perfect and to incorporate all relevant knowledge up to the minute that a complaint arises. The issue for the purposes of the DDA is whether the data, and other relevant factors, are reasonable to rely on. An insurer may well be able to argue that as a matter of commercial reality it is reasonable to rely on advice and data which is updated over a period of years rather than daily. It may also be relevant to the issue of whether reliance on an underwriting manual is reasonable if an insurer wishing to offer an underwritten product can show that it has no choice, legally or in effect, but to comply with guidelines in a particular underwriting manual.

4.6.2 Local data

A range of Australian sources of domestic population or insurance studies including information about disability related risks are available including government studies such as census statistics, studies reported in medical journals, experience studies conducted by individual insurance companies, and insurance studies produced by the Institute of Actuaries of Australia. Reliance on these studies may often be reasonable but, again, insurers should be prepared to defend the reasonableness of decisions where required.

4.6.3 Use of overseas studies

Particularly where local data is unavailable or insufficient it may be reasonable and necessary for insurers to rely on relevant international population or medical studies that include data about disability related risks. Insurers relying on overseas data should be prepared however to demonstrate if necessary that overseas data remains reasonably applicable in Australian conditions or that it is reasonable to rely on it because of limitations of local data or for other reasons.

4.6.4 Relevant domestic and international insurance experience

The Federal Court in the Bassanelli case confirmed that it is reasonable to take into account the relevant claims experience of the insurer concerned and also of other insurance companies. Note that industry experience may be relevant either to demonstrate that refusal of cover or offering cover at a higher premium or with restrictions was reasonable, or that it was not.

4.7 Other relevant factors

If there are no statistics or actuarial data available which are applicable to the situation of the person concerned, a decision to discriminate needs to be shown to be reasonable because of other relevant factors. The following are some examples.

4.7.1 Medical opinion

If relying on medical opinion, it must be on a medical matter.

For example: As population and insurance studies usually only cover single disabilities in isolation a specialist medical opinion may be required to assess the risks of someone who has more than one disability to assess the combined effect of the disabilities.

Conversely, not all medical practitioners may have specialist expertise in assessing long term risks relevant to some types of insurance (life insurance in particular).

The opinion should also be from a medical practitioner with relevant expertise in assessing risks relevant to the particular disability.

For example: An area of medicine in which knowledge is rapidly developing and experience is changing, such as HIV/AIDS, may require a medical practitioner with detailed knowledge in the disease.

It may be reasonable to defer a decision on insurance to seek clarification of medical issues. For example, in one case received by the Commission a woman complained that she had been discriminated against when she was refused loan insurance after disclosing on the application form that she had received treatment for melanoma 14 years previously. The insurer expressed concern that the medical reports provided had not satisfactorily addressed issues of probability of morbidity (illness or disability) rather than only mortality, noting that the policy would cover disability as well as death. After an additional medical report was obtained by the applicant addressing these issues satisfactorily the complaint was settled with the insurer agreeing to provide insurance cover for the remaining period of the loan without charge.

4.7.2 Opinions from other professional groups

It may also be reasonable to rely on the opinion of other professionals with relevant experience, for example occupational therapists, physiotherapists, clinical psychologists or mobility trainers.

4.7.3 Actuarial advice or opinion

Actuarial opinion may be helpful in interpreting medical studies or making allowances for differences in degree of disability between an individual applying for insurance and the study population.

4.7.4 Relevant information about the individual seeking insurance

Information about the particular person seeking insurance will often be relevant to refer to where it is available, in assessing whether the person presents a higher or lower risk than the average person with the disability concerned. This would include the person's individual medical records and work history. Insurers should be careful to avoid assumptions that people with disabilities, or people with the same general type of disability, will always present the same risks.

For example: It would be relevant to consider information about a person's work attendance record when assessing the effect of a disability in relation to income protection insurance.

4.7.5 Commercial judgement

Assessing the likelihood of an insurance claim can sometimes go beyond medical and statistical probability. Other relevant factors may be taken into account so long as it is reasonable to do so.

There may be circumstances where it is reasonable for an insurer to consider an individual's propensity or incentive to make a claim at the time that it is assessing the overall risk of insuring someone with a particular disability. This does not, however, entitle insurers to rely on untested discriminatory assumptions.

Practice of other insurers in the industry, and other relevant commercial practice including by reinsurers, may be taken into account in deciding what is reasonable.

It is not reasonable, however,

• to refuse to insure a person with a disability simply because of historical practice, however widespread or
• to rely on inaccurate assumptions about people with a disability.

If insurance is refused in a situation where other insurers do not or would not refuse, this may be found not to be reasonable unless the insurer concerned can show that it is acting on the basis of special knowledge, or that circumstances apply which do not apply to the other insurers' decisions: see QBE v Bassanelli. One difference in circumstances could be where the insurer is in the business of offering a different product to those offered by other insurers (such as a non-underwritten product which must be offered on standard terms or not at all).

5. Managing risks lawfully: alternatives to denying cover

The existence of section 46 in the DDA acknowledges that in some cases risks associated with a person's disability may be too high, or too uncertain, for an insurer to accept.

However, it would be prudent, before declining to offer insurance to a person with a disability, to consider whether risks can be managed by restricting the cover, using an exclusion clause, applying a premium loading, or some other means.

Discrimination will not be accepted as reasonable unless the consequences of the discrimination are limited as far as reasonably possible.

Exclusion clauses in relation to pre-existing conditions or particular identified risks have been used in a number of cases to setttle a complaint and enable a policy to be issued. For example

• A university lecturer who has multiple sclerosis complained that she was being discriminated against in that the superannuation fund of which she was compulsorily a member limited her benefits not only in relation to her pre-existing condition of MS, but regarding any other illness or disability. The matter was settled without admission of liability when the fund advised that benefits would be unrestricted regarding illness or disabilities other than MS pending further amendments to the trust deed which would remove any restrictions on benefits .
• A computer programmer wished to protect his family income in the event of illness or accident preventing him from carrying out his usual employment. He has a vision disability which may result in his being totally blind in a few years. His applications for income protection insurance were refused. The complaint was settled without admission of liability on the basis that the insurer provided the complainant with disability income insurance with a blindness exclusion.

5.1 Difficulties in using exclusion clauses regarding existing conditions

Issues about denying cover and exclusion clauses in relation to a pre-existing condition were considered by the Federal Court in QBE Insurance v Bassanelli.

In summary, the courts in the Bassanelli case appear to have confirmed the following points:

• Excluding cover for pre-existing conditions is an accepted part of insurance
• Insurers should consider use of appropriate exclusion clauses as an alternative to denying cover
• It may be reasonable to charge a higher premium for cases which are reasonably assessed as presenting a higher risk or where risks are unusually difficult to determine;
• This approach should also be considered before refusing cover
• It may be reasonable to defer a decision to seek further information on risks.

The Court in Bassanelli confirmed a Federal Magistrates Court decision that the insurer had discriminated unlawfully by refusing travel insurance to a woman who has cancer.

The magistrate found that the insurer had refused to issue a policy of travel insurance on any terms, rather than issuing a policy with an exclusion clause for claims arising from the pre-existing condition, because of claims causation issues: that is, the difficulty of determining whether a particular loss through injury or illness was caused by the pre-existing condition and thus covered by the exclusion. He accepted evidence that decisions whether to agree to indemnify under a policy of travel insurance often have to be made speedily, and on the basis of scanty information. He also accepted that there are cases where it is difficult to decide even on the best evidence if a claim is causally related to a pre-existing condition. However, the Magistrate said of such considerations:

But it seems to me that this is what insurers do. Insurers essentially take a bet upon whether a particular set of circumstances will or will not occur. In order to calculate the amount of the premium they assess actuarially their previous claims history, which will include cases where very large claims have been paid because of the acceptance of risk under the type of circumstances outlined which may not otherwise have been accepted. The cost of these mistakes is then built into the policy costs of the very large number of people who take out travel insurance policies with the respondent. I say "large number" because we know that 30,000 + people make claims a year.'

The Federal Court commented:

That did not lead the Magistrate to conclude that an insurer must always issue a policy of travel insurance when such considerations are more real by reason of a pre-existing medical condition He accepted insurers may, and do, exclude insurance in respect of pre-existing medical conditions. He accepted that insurers may, and do, sometimes seek further information to enable them to better assess the risks associated with granting a particular policy of travel insurance, or may in particular circumstances reasonably decline to grant a policy of travel insurance or may reasonably impose a special premium upon the grant of a policy of travel insurance.

However, as he observed, the appellant in this matter had declined to grant any policy at all because of the respondent's pre-existing condition of metastatic breast cancer. He asked whether it was reasonable for it to have adopted that general attitude.

The Magistrate found that a general refusal to issue cover to applicants with metastatic cancer was not reasonable. The Court endorsed that finding.

6. Unjustifiable hardship

Most issues about limitation and exclusion of insurance or superannuation will be dealt with under Section 46. For that reason, these Guidelines deal mainly with the exemption under that section. The DDA , however, also contains a more general exception to unlawful discrimination in providing, goods, services or facilities under Section 24. This is known as the defence of unjustifiable hardship.

It is not unlawful for a provider of insurance or superannuation to discriminate against a person with a disability if it can be shown that providing cover would cause unjustifiable hardship. It is important to note that, even if providing insurance or superannuation to a person with a disability might involve some costs and effort, it will not necessarily amount to unjustifiable hardship. The DDA states that all relevant circumstances of a particular case are to be taken into account in determining unjustifiable hardship.

This includes:

• the effect of the disability of the person concerned
• any costs or other disadvantages of providing cover and
• any benefits that might accrue to the insurer, the customer with a disability or any other person.
• if the insurer has developed an Action Plan under the DDA, any terms of the action plan that are relevant.

7. Case examples: conciliated outcomes

Most complaints received by the Australian Human Rights Commission are settled through the conciliation process. A selection of summaries of conciliation outcomes are presented here. Conciliation outcomes do not necessarily provide firm precedents for what outcomes would be in other cases, since in some cases the respondent may have had a good legal defence but decided to settle the matter anyway. However, these summaries may help in providing a picture of how the DDA operates in practice.

Income protection insurance secured

A woman who had experienced episodes of depression in the past complained that she had been refused income protection insurance. The insurer had advised that it could not offer a policy with exclusions for depression related claims and therefore had to refuse cover completely. The complaint was settled when the insurer revised its policy and agreed to provide cover with an exclusion for depression. (2004)

Income protection insurance

A man who is paraplegic complained that he had been refused income protection insurance on the basis of his disability. The complaint was settled when the insurer agreed to issue a policy with an exclusion clause for claims arising from the complainant's existing disability. (2003)

Insurance and post natal depression

A woman who had experienced post-natal depression (PND) complained that she had been discriminated against by being refused insurance. She complained of sex discrimination as well as disability discrimination, since PND only affects women. The insurer responded that it assessed PND in the same way as other forms of depression based on underwriting manuals which do not make distinctions as to cause of depression. After a conciliation conference the insurer agreed to provide insurance coverage at standard rates as she was able to provide medical evidence that she had recovered from PND. The insurer also agreed to pay compensation, and to write to the international underwriting companies it deals with to highlight the fact that PND is a specific category of depression with different effects and duration to other forms of depression. (2003)

Death and disability cover secured with limited exclusion clause

A woman with a psychiatric disability (a manic condition) complained that she had been refused death or disablement cover because of her disability which she had disclosed to the insurer. In conciliation discussions the insurer advised it was prepared to insure the complainant provided she submitted a medical report regarding risks arising from her disability. The complainant provided a medical report and the respondent subsequently provided her with insurance cover with no restriction on death but with a restriction for the disablement cover for permanent disablement arising from her current disability. This resolved the complaint. (2001)

In another case, a carpenter complained that he had been refused personal accident / sickness insurance because of a single psychotic episode eighteen months earlier. The complaint was settled when the insurer offered cover with an exclusion clause covering psychotic illness. (2001)

Income protection insurance and HIV risk

A gay man complained he had been discriminated against on the basis of an imputed future disability (that is, the risk that he might become HIV positive) when an insurance company refused to give him income protection insurance, even with an HIV exclusion clause (which the complainant was prepared to accept), for longer than a two year period. The matter was settled without admission of liability when the insurer advised that it had reconsidered its decision and was prepared to remove the two year limitation and issue the policy as requested. (1999)

Blindness exclusion clause narrowed

A woman with vision impairment complained that she had been discriminated against by an insurer only being prepared to issue her with a life insurance policy subject to an exclusion clause where blindness contributed to accidental death. The insurer had regarded this as reasonable by reference to actuarial data and other evidence and thus as lawful under DDA section 46. After further discussion the insurer determined that the underwriting manual it was using had been outdated. The matter was settled without admission of liability with the policy being re-issued with a modified exclusion clause covering only situations where blindness is a symptom of a primary health condition leading to death, and a policy change to take blindness into account only where material to the risk and then to apply more up to date underwriting guidelines to determine whether the proposal should be accepted with or without some additional premium loading (1996).

8. Information for respondents to complaints lodged under the Disability Discrimination Act 1992

The Australian Human Rights Commission has the legal obligation to inquire into allegations of disability discrimination made under the Disability Discrimination Act 1992. If a complaint is made against you or your organisation the process also protects your right to fair treatment. You are entitled to know about the complaint and be given a fair opportunity to respond to its claims.

When a complaint is made against an organisation the Commission will generally write to the respondent giving formal advice about the nature of the complaint and providing a copy of the letter of complaint. The President has the legal authority to request information relevant to the inquiry.

Investigation

The respondent will be asked to respond to all the allegations and given an opportunity to provide its version of events and reasons for its decision. A respondent should provide any relevant evidence. In complaints about insurance or superannuation this may include statistical or actuarial information relied on, medical or other information about the complainants' disability and advice about how that information was used to assess the particular application to support the response.

Sometimes the Commission may consider that the matter may be relatively easy to resolve without relying on more formal measures. In those cases the Commission may contact the respondent by telephone seeking a more informal discussion.

A respondent does not need to have legal advice to respond to a complaint although they may obtain it if they wish. Generally, the information provided by a respondent is provided to the complainant and the complainant may be asked to respond to that information or provide further information about their claims.

Respondents are encouraged to co-operate with the investigations of the Commission and to meet the time frames set out in correspondence. The Commission has the legal authority to compel people to provide any particular information it requires to investigate the complaint.

The information the respondent provides may assist the Commission to decide not to investigate the matter further. Where a respondent seeks to raise a defence or exception or seeks to have a complaint terminated for some reason available under the legislation the Commission will consider that request. If the Commission is of the view the exception or defence has not been sufficiently made out to the officer handling the matter will generally contact the respondent to discuss the reasons for that decision.

If there is not enough evidence to support the complaint the President may decide to stop the investigation and terminate the complaint. The respondent and the complainant will be advised of that decision in writing. The complainant may make an application to the Federal Court of Australia or Federal Magistrates Service, within 28 days of that decision, to have the matter heard by the Court. You will be advised by the Court if the complainant does make an application to have the matter heard by the court.