How To Make A Successful TPD Insurance Claim

claims-tpd

Making a Claim for TPD in Australia

It is crucial that all policyholders and anyone looking to take out TPD cover to have a clear understanding on the conditions around claiming TPD in Australia. The process of submitting a claim to actually receiving a benefit payment can be drawn out if the necessary steps are not taken. This article will outline the claims process for TPD insurance that is held within a superannuation fund and for cover that is held outside of superannuation. In doing so it will offer key advice on how to best prepare for the event of a claim to ensure the process runs smoothly and that there is no delay in payment.

Receive a quote for TPD Insurance or review your existing cover

finder.com.au is a comparison service and not an insurer. For clarification for whether you are eligible to receive a claim, please always refer to your Product Disclosure Statement or contact your insurer. If you are having issues with a claim or feel you have been treated unfairly by your insurer, you will need to contact your insurer and go through its dispute resolution process. If after this process you’re still not satisfied, you can contact the Financial Ombudsman Service.

When can a Total and Permanent Disability insurance claim be made?

A TPD claim benefit can be received when the policyholder has satisfied the definitions of TPD as defined by the insurance company or Super Fund in which their cover is held. It is extremely important for policyholders to be clear on what definition their policy falls under to avoid any surprises in the event of disablement. Generally, Total and Permanent Disablement will be considered under either “Own Occupation” or “Any Occupation”

  • Own Occupation: The policyholder has become disabled and is unlikely to ever return to full-time work in the position of which they are employed. Own Occupation TPD Insurance is no longer offered through superannuation. This came into effect July 1, 2014.
  • Any Occupation: The policyholder has become disabled and is unlikely to ever be able to engage in any form of regular paid work again for which they may be suited to by education, experience or training.

What is the criteria for a successful TPD claim?

Most providers will require the claimant to be unable to perform the duties of their occupation for at least three months. Conditions of the TPD cover are also often subject to the occupation category of the policyholder.


How do I make a claim (outside of super)?

Claiming standalone TPD Insurance is quite similar to claiming TPD held inside of Super though there are some differences between the two processes. Each claim process may differ depending on the type of claim and the insurance provider though in most cases it follow the following steps.

Steps to make a TPD claim:

  1. Contact the insurers claims team: The claims team will provide the policyholder with the necessary claims form. Your financial adviser may assist you fill out the documents if necessary.
  2. Prepare Necessary Documentation: This will usually include;
    1. Completed claim forms
    2. Medical attendants statement completed by certified medical practitioner giving verification of the illness/injury.
    3. Bank details may be required to allow provider to deposit any benefits into nominated account.
    4. Details of previous health claims may be required.
  3. Submit Claims Documentation: Completed claim documentation to be submitted to insurance provider.

How do claims work for TPD inside super?

Some superannuation funds will now offer a default level of TPD cover for members. Members can check if there is TPD cover in their super fund by contacting a fund representative and requesting a copy of their online statements.

How will my claim be assessed inside super?

In order to receive a TPD benefit from their super fund a member must;

  1. Satisfy all conditions of the fund insurance contract.
  2. Satisfy the permanent incapacity definition as stated under super law.
  3. Satisfy “disability super benefit” definition stipulated under Australian tax law. This will allow the policyholder to claim an additional tax-free portion on the lump sum benefit.
  4. Fund trustee must be satisfied that the insured has met the conditions of the policy and is unable to engage in employment that they have are qualified in by education, training or experience.

How do I make a claim inside superannuation?

  1. Contact Super Fund: Policyholder to contact their super fund after which they will be provided with necessary claim documentation. They will also need to provide additional documentation. This might include;
    • Identification - Birth Certificate, Drivers Licence, Passport
    • Existing medical reports
    • Medical evidence to support claim
  2. Submit Claim: Claimant to sign their claim statement and attach to all necessary documentation. This will then be provided to their Case Manager. A Case Manager provides assistance throughout the claim process, ensuring all of the necessary documentation is received.
  3. Organisation of Claim by Case Manager: Case Manager will assess policyholders claim to determine whether they are eligible to receive a TPD benefit. They will usually contact the claimant's employer to receive a written statement as to why they ceased work.
  4. Claim is Assessed By Insurer: An insurance provider will assess the documentation submitted. In some cases further evidence may be require including;
    • Doctors reports
    • Further medical examination with an independent specialist
    • Further information from the claimant's employer
    • Further information from the claimant
  5. Claim is Assessed by Insurer: The insurance provider will assess the claim and determine if it is;
    • Accepted: Claimant contacted with claim payment options.
    • Declined: Claim is deferred while the provider assesses full extent of disability and its permanency. Claim is denied as the insurer has deemed the claimant has not satisfied the conditions of the policy.
    • Deferred: Claim is deferred while the provider assesses full extent of disability and its permanency.

If the claim is deferred or declined it will be referred to the fund trustee who will review the decision made by the insurance provider on the claimant's behalf.

How do TPD claims work for multiple super funds?

It is not uncommon for people to have TPD insurance that has accumulated in multiple funds that have been opened by different employers. It is possible in some circumstances for the policyholder to claim multiple benefits at the same time. However it is important that the claimant carefully checks the conditions of each fund before submitting multiple claims at the same time.

Is there a time limit on superfund claims?

There is no time limit on when an TPD claim can be made for a benefit payment for TPD held within Superannuation. That said, there are time limits placed on when an appeal can be submitted for the refusal of a TPD claim. Legislation states that the Superannuation Complaints Tribunal can only review a complaint that has been made within two years after the making of the trustees decision of which the complaint is related to.

Read more on tpd insurance inside superannuation


Partial disablement feature

Some insurance providers will provide the option for Partial Disablement where as a result of sickness or injury the policyholder is not totally disabled and is able to work in their own occupation at a reduced capacity. As a result, the insureds monthly income is less than the pre-disability income. This must be certified by an approved medical practitioner.

Benefits may be paid out if you meet any of these two definitions

  • Hours Based Partial Disablement: Benefit paid if policyholder has returned to work following being partially disabled for entire duration of waiting period and is able to perform duties in their occupation for defined number of hours, is earning less than their pre-disability income and is under medical care.
  • Duties Based Definition: Benefit paid after policyholder has returned to work following being totally disabled and is not capable of performing the duties essential in producing their income and is forced to earn less than their pre-disability income.

This benefit is determined using the following formula:

(Pre-disability income - post-disability income) / (pre-disability income x monthly benefit) Some policies will provide this partial payment under certain defined conditions suffered by the policyholder. This may include the permanent loss of the use of;

  • One arm, or
  • One leg, or
  • Sight in one eye

Assessing claims for depression and other mental illnesses

Policyholders should be aware that it can be difficult to prove that they will be unable to return to work again on account of mental illness. The episodic nature of mental illnesses can make it difficult for diagnosis to be formed.

Considerations for TPD claim related to depression and mental health

  • The type of treatment prescribed by practitioner and the regularity of that treatment. This consideration is of particular importance for claims that are late in submission.
  • Benefit payment for a mental health claim may be deferred if it is believed that the permanency and severity of the insureds conditions is unable to determined. This can be prolonged until all treatment options are trialled.
  • Definition of total and permanent disablement in policy. For claims based on disability preventing individual from their own or any occupation as a result of work related stress, an underwriter will assess if they would still be unable to perform their duties at another place of employment or if their duties at their current work were adjusted.

Before you claim: Duty of Disclosure

It is crucial for anyone looking to take out protection cover that they fully understand their obligations under a “duty of disclosure”. In the event that a claim is made, this is the first document that will be checked against the claim application form. Before applicants enter into an insurance contract for TPD cover, they are required to disclose any relevant information that may be required by the insurance provider to allow them to assess your situation. This is known as the duty of disclosure. This duty of disclosure is legally binding and applicants must disclose any relevant known information to avoid legal consequences for not informing the underwriter of information that may affect the policy. In the event that the applicant has failed to comply all information in their duty of disclosure and the policy is less than three years old, the insurer is within their rights to check the duty of disclosure and terminate the contract. In the event that the insurer finds that the duty of disclosure is fraudulent, they may also reduce the sum-insured in accordance to the premium that would have been payable had the correct information been disclosed at the time of application.


What if my claim gets denied?

In the event that the claim is denied by the Insurance provider, there are certain steps that can be taken to have the decision reviewed.

Appealing your claim

1. Submit a Complaint to the Insurance Provider Policyholders should contact the chief underwriter of the insurance companies claim department. It is important to Take the time to set out the complaint to the underwriter in full with evidence to justify request for further review. Policyholders should request that the chief underwriter addresses each issue. The policyholder may be required to receive further medical documentation from their doctor. A more comprehensive report may be needed if the claim is to undergo further review. 2. Submission of Complaint to the Insurance Providers Internal Dispute Resolution Service If the policyholder is not satisfied with the response received by the underwriting division they are able to write to the Complaints and Disputes Resolution Manager of the Company. Each insurance provider is required to have this department under standards set by the Australian Securities and Investments Commission. 3. Submit Complaint to the Financial Ombudsman Service If the claimant is not pleased with the response from the provider they are able to write to the Financial Ombudsman Service. All claimants will need to undertake the previous steps with the insurance company before contacting the Financial Ombudsman Service.


Preparation is key for a successful Total and Permanent Disability insurance claim

As with any form of protective cover, a successful claim for TPD will be the result of the insured clearly understanding the conditions of their policy and what events they are covered for. This goes hand in hand with disclosing all known relevant information at the time of application to the insurer and notifying the provider of new conditions that may not be covered as they surface. Policyholders who take the gamble of not disclosing important details are gambling their chance to receive a payout for events that could bring great financial hardship. In addition, understanding the actual claims process for cover held within and outside of super will ensure that the overall process is executed smoothly and there is no delay in the payment of their claim.

Receive TPD Insurance Quotes from up to 12 Insurers

Please enter your full name
Please enter a valid email address
It's important to give us a valid phone number
Gender
Smoker
Date of Birth
Coverage is the amount of money that you will be paid in the event of a claim. An insurance consultant can help you determine an appropriate amount. Calculator
Provides a lump sum payment if you become totally and permanently disabled and are unable to return to work.
Provides a lump sum payment if you suffer a serious medical condition. Cover can be taken out for 40-60 medical conditions depending on the policy you choose.
By submitting this form, you agree to the finder.com.au privacy policy
Compare Quotes
Was this content helpful to you? No  Yes

Related Posts

Ask a Question

You are about to post a question on finder.com.au

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Disclaimer: At finder.com.au we provide factual information and general advice. Before you make any decision about a product read the Product Disclosure Statement and consider your own circumstances to decide whether it is appropriate for you.
Rates and fees mentioned in comments are correct at the time of publication.
By submitting this question you agree to the finder.com.au privacy policy, receive follow up emails related to finder.com.au and to create a user account where further replies to your questions will be sent.

Ask a question
feedback

Exciting news!

myNBN.info is now part of the finder.com.au family.

Read more about what this means