Mental health in Hong Kong: closing a protection gap

Mental health is a concern for many residents of Hong Kong, and the COVID-19 crisis is likely to exacerbate this. Treatments for mental health issues are mostly provided by the public sector, but the level of service provision falls short of need.  Private sector services are available but are much more expensive.  Insurance can help close the gap in the provision of mental health treatment services in Hong Kong.

A beneficial impact of this year's pandemic has been to increase awareness and openness about mental health, presenting an opportune time for insurers to become more proactive on mental health solutions. Currently, in the Hong Kong market there are just a few insurance products that cover mental health illness. On the supply side, lack of experience data has made the underwriting process difficult. Co-morbidity and adverse selection have further complicated the issue. On the demand side, low awareness and the reluctance of Hong Kong residents to admit to mental health problems pose the biggest challenges.

Insurers' capability to underwrite mental health risks is being enhanced by advances in understanding of illnesses, consumer behaviour, diagnosis criteria, recovery paths and treatments enabled by advanced analytics. We recommend that insurers in Hong Kong focus on both product design and collaborative public-private partnerships to help narrow the existing shortfall in the provision of mental health services.