What is Total & Permanent disability insurance?
Total & Permanent disability insurance (commonly known as TPD insurance) is an insurance policy that provides a lump sum benefit to policy holders if they develop an injury or illness that permanently prevents or limits their ability to work.
TPD policies are commonly provided as part of superannuation funds, as the law permits the policies to be paid from the superannuation (meaning that it is not taxed), and because the superannuation funds obtain significantly better terms by buying policies that cover large numbers of members. TPD benefits may also be available under a private life insurance policy.
Unlike a workers compensation claim, or a negligence claim for damages, a TPD policy does not require that the injury or illness isrelated to work or as a result of someone else’s action. While the precise terms of the policies vary between insurer most policies will respond if:
- you have been continually absent from work because of injury or illness for a specified time (usually 3 months or more) and
- you are unlikely to ever work in any occupation or work for which you are reasonably qualified by education, training and experience.
Some policies (“own occupation”) only require you to be unlikely to work again in your usual occupation.
Further, some policies require you to satisfy a minimum level of employment before you are eligible to seek a total and permanent disability payout. This is generally in the form of total length of employment or number of weekly work-hours.
It is not necessary to show that you will never work again but rather that you are unlikely to work in a job based on your training and experience. For example, if you have only worked as a manual labourer and have no other training or experience, then you would be able to claim for total and permanent disability even if you were medically fit to perform an office job.
If you are a member of several different superannuation funds, you may be able to claim TPD entitlements through each fund.
What are the steps in making a claim?
Making a claim for total and permanent disablement involves completing a claim form and providing medical evidence. It is important that before any medical evidence is obtained the medical practitioner understands the policy requirements. You may also need to provide evidence as to your education, training and experience.
If your claim is accepted you will receive a lump sum payment which in most cases is substantial and is in addition to any benefits you receive from Centrelink, workers compensation, motor vehicle or common law claim for the injury or illness.
What if my Claim is Rejected?
If your claim is rejected you have a number of options. Most policies will allow for an internal review. If an internal review rejects your claim then you can make a complaint to the Superannuation Complaints Tribunal or you can bring proceedings against the superannuation fund or insurer in the District Court or Supreme Court.
You can also bring proceedings in the District Court of Supreme Court if the superannuation fund or insurer is taking too long to make a decision in relation to your claim,
Segelov Taylor Lawyers can assist you in completing an application form and obtaining medical evidence to support your claim. If your claim is rejected then Segelov Taylor Lawyers can assist you to challenge the decision by way of an internal or external review and provide advice and act for you in the event court action is required.