Most working Australians have total and permanent disability insurance through their superannuation fund without fully realising it. For the great majority of people who hold this cover, it sits unexamined in their super account – a safety net they hope they will never need. When a serious illness, injury, or medical condition does prevent someone from returning to work, this insurance can represent one of the most significant financial resources available to them. The challenge is that accessing it is rarely straightforward, and the claims process has features that consistently disadvantage claimants who navigate it without specialist legal advice.
McDonnell Schroder has assisted clients in Western Sydney with superannuation and TPD claims as part of our personal injury and insurance practice. This article explains what TPD insurance is, how the claim process works, and why the quality of legal representation makes a real difference to the outcome.
What TPD Insurance Covers
Total and permanent disability insurance pays a lump sum benefit to a member who is totally and permanently disabled. The definition of total and permanent disability in the insurance policy determines who qualifies for a payout, and this definition is one of the most important and most contested aspects of any TPD claim.
There are two main types of TPD definition. An ‘own occupation’ definition pays the benefit if the claimant is permanently unable to work in their specific occupation – the occupation they held at the time of injury or illness. An ‘any occupation’ definition only pays if the claimant is permanently unable to work in any occupation for which they are reasonably suited by education, training, or experience. The ‘any occupation’ definition is significantly harder to satisfy and is the most common source of disputed TPD claims, because insurers often take a narrow view of what the claimant is still capable of doing despite their medical condition.
Which Super Fund and Which Policy
The first step in any TPD claim is identifying the correct policy and fund. Many Australians have been members of multiple super funds over their working life, and TPD insurance may be held in more than one fund simultaneously. Lost or inactive super accounts may hold valid TPD cover. It is worth checking the ATO’s lost super register and your own employment history to identify all funds in which you have been a member during the period leading up to your incapacity.
Once the relevant fund or funds are identified, the policy documents need to be obtained and reviewed carefully. The specific definitions in the policy – including what constitutes total and permanent disability, how permanence is assessed, and any exclusions that might apply – determine the legal basis of the claim.
The Medical Evidence Required
A TPD claim stands or falls primarily on medical evidence. The insurer will require comprehensive medical reports from your treating doctors and specialists, may require you to attend an examination by a doctor of their choosing, and will assess the medical evidence against the policy definition of total and permanent disability. Preparing the medical evidence correctly is one of the most important steps in the claims process.
The medical reports need to address not just the diagnosis and prognosis but specifically the questions that the policy definition requires to be answered – whether the condition is permanent, whether the claimant is unlikely to ever return to any work, and the basis for that assessment. Reports that address the medical condition without specifically engaging with the policy definition language are frequently used by insurers to justify rejection or to request additional information, extending the process and creating additional stress for the claimant.
What Happens if the Insurer Rejects the Claim
Insurer rejection of a TPD claim is not the end of the process. An initial rejection can be the subject of an internal dispute resolution complaint to the fund or insurer, and if that does not resolve the matter, a complaint can be made to the Australian Financial Complaints Authority (AFCA). AFCA is an independent body with the power to review the insurer’s decision and make binding determinations. In cases where AFCA does not resolve the matter satisfactorily, court proceedings are available as a final option.
The internal review and AFCA processes require the same quality of preparation as an original claim – detailed legal analysis of the policy, carefully constructed medical evidence, and well-articulated argument about why the insurer’s rejection was incorrect. Having legal advice before filing an internal review complaint, rather than filing informally and then seeking advice if the complaint is also rejected, typically produces better outcomes and avoids the consequences of poorly framed initial complaints.
Why Legal Advice Improves TPD Claim Outcomes
McDonnell Schroder acts for clients in TPD claims on a No Win No Fee basis for eligible matters. Our involvement in a TPD claim improves outcomes in several ways: by identifying all potentially applicable policies across multiple fund memberships, by ensuring medical evidence is directed at the specific policy definition rather than prepared in general terms, by engaging with the insurer on a legally informed basis from the outset, and by providing clear advice about the dispute resolution options available if the initial claim is rejected.
If you or a family member has been prevented from working by a medical condition and you are uncertain whether a TPD claim might be available, contact McDonnell Schroder for a free first consultation. Call us on (02) 9622 1155 or visit our Blacktown office.
