The chair of Victoria's mental health royal commission has described the suicide rate among sexually and gender diverse people as "totally unacceptable".

Key points: People from the LGBTQI community are up to 11 times more likely to attempt suicide

People from the LGBTQI community are up to 11 times more likely to attempt suicide There is a level of distrust for mainstream mental health services among some sexually and gender diverse people, the commission is told

There is a level of distrust for mainstream mental health services among some sexually and gender diverse people, the commission is told Victoria's gender and sexuality commissioner Ro Allen says more LGBTQI friendly mental health services are needed

The inquiry heard on Wednesday that lesbian, gay, bisexual, trans and gender diverse, intersex and queer communities have the highest suicide rate of any group in Australia.

"I [am] very challenged by that data," the commission's chair, Penny Armytage, said in an uncharacteristic remark during Wednesday's hearing.

National statistics show young people from LGBTQI communities are between five and 11 times more likely to attempt suicide, while almost half of transgender young people report making at least one attempt on their life.

Victoria's gender and sexuality commissioner, Ro Allen, told the inquiry the suicide rate was under-reported and the real numbers were likely to be much higher.

"We have very bad data collection around this," the commissioner said.

"I remember going to funerals of young LGBTI people and families didn't know they were queer; it certainly wasn't recorded."

The commissioner put the under-reporting down to shame and stigma and said organisations and individuals had a role to play to improve that.

"Until we reduce the stigma of being LGBTI, people won't record that in their suicide stats," the commissioner said.

"Why don't we ask about somebody's sexuality and gender identity and intersex variation?

"We're probably not going to choose to answer it if we don't feel safe, but the fact that the question is there reduces the stigma."

We don't wake up 'hating ourselves'

The commission heard LGBTQI people were not at a higher risk for poor mental health because of their sexuality or gender identity, but because of the discrimination they faced in daily life.

"It's not uncommon to just have abuse yelled at you," the commissioner said.

"You never know whether that's going to escalate into anything potentially violent."

The commissioner said LGBTQI people experienced verbal and physical abuse at a much higher rate than the wider public.

"The constant living with the fear of being discriminated against — I mean, my own personal experience of physical harm and violence, it has an accumulative effect," the commissioner said.

"We don't wake up in the cot hating ourselves, it comes from somewhere."

The inquiry heard there was a need for mental health services that were safe and inclusive for LGBTQI people.

"We're not asking for special treatment," the commissioner said.

"We're asking for fair and reasonable treatment to live in dignity to access services that, unfortunately, we need."

The commissioner said there was a level of distrust and fear of mental health services among some LGBTQI people, pointing out that up until the 1970s homosexuality was considered a mental disorder.

"[The fear of] being discriminated when you arrive at a hospital or health service is so critical," the commissioner said.

"I think that services run by, delivered for, and with LGBTI people are really important because, for some people they're just not going to access mainstream services."