Are mental health conditions covered by Income Protection insurance?

Mental health conditions are covered under all 9 panel Income Protection policies as a sickness, subject to the same waiting and benefit periods as physical conditions. No panel PDS imposes a blanket mental-health exclusion at the policy level. Specific underwriting exclusions may apply at application time if you have a personal mental health history.

Mental illness, including depression, anxiety, post-traumatic stress disorder, and burnout, is the largest single category of IP claims in Australia by frequency. Insurers therefore underwrite mental-health history carefully at application.

How mental health is treated at the policy level

All 9 panel insurers treat mental illness as a 'sickness' under the IP contract. The same definition of 'totally disabled' and the same waiting and benefit periods apply.

• AIA Priority Protection (Version 32, 9 November 2025): mental illness is covered as a sickness under IP CORE. The TPD lump-sum tests reference 'Mental Illness (severe and permanent)' as a separate matter.
• TAL Accelerated Protection (12 December 2024): mental illness claims pay as sickness under the IP definition; the Permanent Incapacity Reset Benefit references 'Mental illness category' separately for TPD.
• Zurich Wealth Protection (1 November 2025): 'mental health or behavioural condition' is recognised across claim categories. Claim management may include a treating psychiatrist.
• OnePath OneCare (October 2025): mental illness covered as sickness under Income Secure Cover.
• ClearView ClearChoice (13 May 2024, Update 5 June 2025): mental illness covered as sickness under Income Protection Flex.
• NEOS Protection (6 December 2024): mental illness covered as sickness under Income Support Cover; 'formal neuropsychological testing' may be required.
• Encompass Protection (26 September 2025): mental illness covered as sickness under Income Protection Cover.
• Acenda Insurance (27 September 2025): mental illness covered as sickness under Income Protection.
• Futura Protection (1 October 2025): mental illness covered as sickness under Income Protection Cover.

Personal exclusions from underwriting

The critical caveat is personal underwriting exclusions. If you have a documented mental health history at application, the insurer may apply a personal exclusion on your policy schedule. The exclusion is recorded in your contract documentation, not the PDS. Personal exclusions are negotiable across insurers because each underwriter views mental health history differently.

If you have ever been treated for depression, anxiety, PTSD, an eating disorder, or another mental health condition, compare offers across multiple panel insurers. Differences in personal exclusions can be material.

Benefit-period caps on mental health claims

Some retail IP policies cap the benefit period payable for mental health claims at a shorter duration than the policy's stated maximum (commonly 2 years, even where the base benefit period is 5 years or to age 65). Whether your contract applies this cap depends on the insurer and the policy tier you selected.

This is one of the most material differences between policy tiers. When comparing options, check the PDS for mental health benefit-period treatment under each contract you are considering.

What the IP claim process looks like for mental health

• Treating GP or psychologist completes a medical attendant's statement.
• Treating psychiatrist may be required for severe presentations (Zurich refers).
• Neuropsychological testing may be required for some claims (NEOS).
• Insurer-paid Independent Medical Examination by a psychiatrist may be requested.
• Treatment compliance (medication, therapy attendance) is typically a condition of ongoing payment.

Practical guidance

• Disclose any mental health history honestly and completely at application.
• Keep treatment records, prescriptions, and specialist letters.
• Engage with rehabilitation and return-to-work programs the insurer offers; refusal can suspend benefits.
• If a personal exclusion is offered, ask the broker to seek alternative terms from other panel insurers before accepting.

General advice only. Mental health treatment of IP claims is an evolving area; confirm the current PDS wording and your policy schedule against any historic understanding.