When illness or injury strikes, it can have devastating effects, including on your ability to continue working in your industry or profession.
Where a superannuation fund has taken out a group policy of total and permanent disability insurance (‘TPD’) for its members, you may be able to lodge a TPD claim and apply for a lump sum insurance benefit.
You must meet a definition of TPD contained in the insurance policy. Usually, a requirement is that you have been unable to work for 3-6 months, and will be unlikely to work again, in either your own occupation, another occupation for which you are reasonably qualified by way of experience, education and training, or any other occupation.
Unfortunately, not every application is successful. A declined TPD claim can be stressful and confusing, particularly when you believe you meet the insurer’s definition of total and permanent disability.
If you are wondering “why is my TPD claim being declined?” or “why do TPD claims get rejected?”, understanding the insurer’s reasons is the first step towards challenging the decision.
But what happens if you have submitted a TPD claim, and it is declined? We explore three reasons why TPD claims are often declined.
Why do TPD claims get rejected?
Every insurance policy is different, but most rejected TPD claims fall into a handful of common categories. In many cases, a rejected TPD claim does not mean the decision is final. Insurers can make errors, rely on incomplete information, or interpret the available evidence differently from your treating doctors.
Below are three common reasons a TPD claim may be declined.
1. The insurer alleges you are able to resume your pre-injury occupation
Sometimes TPD claims are declined because the insurer does not believe you are prevented from working in your occupation.
This is one of the most common reasons for a declined TPD claim.
This usually occurs when there is conflicting or inadequate medical evidence regarding the extent of the your injury or illness.
Most insurance companies, as part of the claim process, require two qualified medical practitioners to certify that you are totally and permanently disabled. For most people, this certification is done by your treating specialist and general practitioner. It is also common for insurers to request additional paperwork and information from your treating doctors.
If one or both medical practitioners do not agree that you are totally and permanently disabled, the insurer may find there is not enough evidence that you meet the TPD definition. The claim can then be declined.
2. The insurer alleges you can work in another occupation that is within your education, training or experience
A common reason why TPD claims are declined is that the insurer believes you are capable of working in another occupation.
When assessing a TPD claim, insurers often consider whether you could perform another role that matches your skills, qualifications or previous work experience. This can result in a TPD claim being rejected even where you cannot return to your former occupation.
This is common in situations where a person has worked in one occupation for most of their life. Although the medical evidence suggests they cannot perform that occupation anymore, they have worked in another industry in the past or possess transferrable skills.
When these types of declinations occur, it is usually because the TPD definition provides that you must be unable to work not only in your own occupation, but also in any other occupation for which you are reasonably qualified by way of education, training or experience.
Example
- John has worked as a boilermaker for almost all of his life, performing heavy manual labour work.
- John suffer a serious back injury and has been told by his treating doctors he is unable to ever work again as a boilermaker.
- John also has an interest in collecting antiques. About five years ago, he registered an ABN so he could sell some of his antique finds at a weekend market stall.
- The insurer declined John’s claim. It alleged John has business administration skills and can work as a business manager, which is within John’s education, training and experience due to his experience running a business.
3. You did not hold any insurance at the “date of disablement” under the insurance policy
Finally, TPD claims are often declined because the insurer alleges you did not have insurance coverage at the “date of disablement”. Many people are surprised to learn that disputes about insurance coverage dates are another common reason a TPD claim is declined.
The date of disablement is a deemed date prescribed under the insurance policy and is used to determine your applicable insurance coverage. It is usually the date on which you last physically worked, but can include when you were first diagnosed with your illness, or first sought medical treatment.
A common situation that arises is when a person holds insurance when they last worked in their pre-injury occupation, but returns to work at a later date in an alternative occupation. Sometimes, the insurance coverage at the date they last worked in their pre-injury occupation is different to when they last worked in any occupation. If insurance coverage ceased before the later date, a claim can be declined.
Example
- John has not worked as a boilermaker since 1 January 2019, the day of his back injury.
- At 1 January 2019, John had $100,000 of TPD insurance coverage.
- John participated in a six week work trial as a bus driver, organised by his workers compensation insurer. He finished this work trial on 1 July 2020.
- Between 1 January 2019 and 1 July 2020, John’s TPD insurance coverage ceased.
- The insurer declined John’s claim, alleging the date of disablement under the policy was 1 July 2020. At that date, he had no insurance coverage.
What to do if your TPD claim is declined?
If your TPD claim is declined, it is important not to assume that the insurer’s decision is correct or cannot be challenged. Many declined TPD claims can be successfully reviewed when additional evidence is provided.
Depending on the circumstances, you may be able to:
- Request a review of the insurer’s decision;
- Obtain further medical evidence from your treating doctors;
- Arrange an independent medical assessment;
- Challenge the insurer’s interpretation of the policy definition; or
- Lodge a complaint with the relevant dispute resolution body.
Seeking legal advice as soon as possible can help you understand your options and improve your prospects of overturning a rejected TPD claim.
Do you need help with a TPD claim?
If you have been unable to work due to injury or illness, you should obtain legal advice. Your superannuation fund may have taken out a group policy of TPD insurance and you may be entitled to lodge a claim.
If your TPD claim has been declined, your lawyer can assist in requesting a review. Often, further medical evidence from your treating doctors, or an independent medical examination, will assist in overturning the insurer’s decision.
Many people whose TPD claim has been rejected are surprised to learn that they may still have options available to them. Obtaining legal advice early can help identify whether the insurer’s decision should be challenged.
Turner Freeman are experienced in assisting injured people with TPD claims. Having a lawyer means you can ensure a professional is handling your claim and submitting the most relevant information to the insurance company. If you would like assistance with a TPD claim, contact our expert TPD lawyers on 13 43 63.
