If you are sick or injured and unable to work, you can make a TPD benefit claim. A TPD benefit is a lump sum of money paid out to you, on top of your superannuation account balance. Your benefit is calculated in a number of different ways which are described below.
The Usual Superannuation TPD insurance policy
Most people in Australia have TPD cover but know nothing about it. This is because it’s automatically given to you by your super fund under a group insurance policy. A group insurance policy covers a group of members.
In group insurance policies, the dollar value TPD amount provided is linked to your age. Usually, as you get older or closer to your retirement age, the benefit will decrease. Super funds also use other classifications to determine your cover, such as whether you are in ‘high risk employment’ and this can be divided into further categories such as ‘white collar’ and ‘blue collar’.
People can increase their TPD benefit and can also ask for a specific amount of insurance cover. This means you would be paying monthly premiums. As you get older, the TPD benefit can increase or decrease or stay the same.
Where people have customized their insurance cover, the super fund would usually request some information on your health and employment before granting a higher amount.
Retail Policies / Retail Life Insurance Policies and Separate TPD Insurance Policies
Many people in Australia have TPD insurance which sits outside of a super fund. Usually, a financial advisor has helped set it up. These sorts of insurance benefits are much larger as they have been calculated to cover the cost of living comfortably if you are unable to work. The insurance premiums are higher and therefore not particularly desirable for most people. Some insurance companies which offer insurance like this are AMP, BT Super, MLC and TAL.
The amount paid out will be what you and your financial advisor decided you needed. It is often around the million dollar mark.
Due to the high amount, insurers scrutinize these claims closely and will have their lawyers oversee the claims process. Often minor details in the initial application or in a medical report can be relied upon to reject the claim. It’s a very good idea to have experienced legal representation.
How do I know how much I am covered for?
On your superannuation statement you will see, “TPD Benefit” and a dollar amount. This is the amount for which you are covered in that period. It’s important to note that the amount of TPD you are covered for is linked to your last day worked.
Therefore, if you stopped work 2 years ago, this year’s statement will not be an accurate description of the TPD benefit you are able to claim.
Also, your membership with a super fund may have ceased since you stopped work. This does not necessarily mean you have no TPD cover. As long as the membership was active on the last day you worked, you can still have TPD insurance.
Will I be paid the whole benefit?
A successful TPD claim means that you get the full lump sum TPD benefit, as well as the option to withdraw your full account balance. Nearly all claims are paid in full.
Some super funds, like MTAA, will approve 80% of your benefit if you satisfy the ‘general’ TPD definition and require the further 20% to be assessed against a much more stringent definition.
Funds like Hesta will only pay TPD benefits in installments requiring they’re members to re-satisfy the TPD definition for the rest of their lives which is very onerous.
In rare instances, super funds are unwilling to pay the full amount. They may believe they have a strong case to decline your claim or they may be playing ‘hard ball’. Where other lawyers will walk away, we increase the pressure. We specialize in situations where the super fund is unwilling to pay the full amount by forcing the super fund and insurer to the negotiation table. Never accept your claim being declined until talking to PK.
Unable to work? Call PK.
Injured and sick people from all over Australia have claimed their TPD benefits with our help. We lead the field in the uptake of technology so that claims are run efficiently and our clients kept up to date. Our main office is located in Sydney, along with all the major super funds and insurance companies.
Frequently Asked Questions
Yes, you can. If you’re diagnosed with a serious cancer that has an impact on your ability to work, you may not realise you are entitled to claim insurance benefits through the insurance provided through your superannuation. These benefits may include income protection if your disablement is temporary, and TPD if your condition is long-term and serious. If your condition is terminal, you will be eligible for a terminal illness payment.
Yes, you can. People are now becoming more aware of depression and other mental illnesses, and while there’s a way to go before the stigma is lifted, we’re talking about it more often. Around one in four Australians suffer from a mental illness each year. However, insurers are wary of mental illness disability claims, and it can be quite hard to get cover. But what many people fail to recognise is that the automatic TPD insurance you have through your superannuation fund can pay out much-needed benefits and funds if you cannot work due to depression or any other mental illness.
Mental illness can often be a lingering side effect of a physical injury, even after full physical recovery.
Yes, you can have multiple TPD claims providing your insurance policies or super funds are independent of each other. Bear in mind that, unlike other personal injury claims, when you make a TPD claim, you do not have to prove that the illness or injury was work-related or caused by somebody else.
A successful TPD claim can never be 100 per cent guaranteed, but you are much more likely to win your claim if you contact a TPD specialist lawyer at PK Simpson to discuss your situation. There is a minimum level of evidence required to support your claim, which must be provided to your insurer and your super fund. This includes your claim form, a signed authority, certified ID, and two medical reports from your treating doctors showing that you can never return to work. These will need to be reviewed by a lawyer to ensure all the correct boxes are ticked, and that the evidence strongly supports your claim for TPD.
Often, terms and conditions specific to your policy need to be analysed in order to make sure the fund cannot decline your claim.
Superannuation funds will often require specialist reports. Superfunds do not pay for treatment throughout the claims process. However, PK Simpson pay for all medical reports needed to support your claim.
Most claims are paid out and finalised within three to six months, but it all depends on how complicated the claim is, and how much good evidence you have about your injuries. There is also the matter of whether you fulfil all the criteria set by your insurer. This is why it’s crucial to have a specialist TPD team on your side when you make a claim for TPD for any reason.
As lawyers we will make sure your claim is assessed by the superfund in a timely manner. Delay tactics are deployed by funds to prolong and frustrate TPD claimants who are not legally represented.
If you haven’t been able to work in your usual job for three to six months due to an injury or illness, you are likely to be classed as TPD.
Each superfund has their own TPD definition and this must be satisfied for the TPD claim to be approved. Common factors which are assessed in each claim are the members work history (education, training and experience), suitable jobs, and medical evidence.
Your TPD entitlements are set out in the contract (a.k.a. policy, or product disclosure document) you have with your insurer. Therefore, the definition of TPD will vary between policies and insurers.
If you or anybody you know has ceased work due to illness or injury and they cannot return for at least six months they could be eligible to claim TPD benefits. Call PK Simpson specialist TPD lawyers today on 1300 358 057 or email inquiries@pksimpson.com.au