Q & A on Superannuation, TPD and Insurance claims
Q & A on the 2GB Chris Smith Afternoon Show – discussing Superannuation, TPD and Insurance claims – 11 October 2016
Tuesday, 11 October 2016
CS – Chris Smith /KB –Kerry Byrnes /C1,2,3, etc – Callers
CS Here’s your chance to get some free legal advice only here. I bet you can’t do that anywhere else. Only here. Pick up the telephone – 131 873. Well the insurance industry is getting a shakeup. So we will find out what that’s all about and we are going to hear about personal injury claims that you can make through superannuation policies. Thanks to Turner Freeman Lawyers and their Legal Mattes Segment here, we’ve got a $100 Westfield voucher to give away once again. Turner Freeman Lawyers by the way provide a range of specialised legal services including compensation and negligence law, asbestos litigation, superannuation and disability claims, family and employment law, Wills and estates and property law. Their NSW offices are in the CBD, Parramatta, Campbelltown, Penrith, Newcastle and Wollongong. They’ve also got offices in Queensland, South Australia and WA. If you’ve got a question about claiming TPD through your superannuation – 131 873. Now Kerry Byrnes specialises in total and permanent disability and income protection claims made through your superannuation policies. Kerry is based at the Turner Freeman office in Sydney and joins me in the studio right now. Kerry. Thank you very much for your time.
KB Thank you for having me again.
CS Let’s go to this draft Code of Practice. Now the Financial Services Council is circulating a draft Code of Practice which means the industry is about to get a shake up. There will be a transition period until the 30th of June next year for all members of the Financial Services Council to be bound by and compliant within the Code. Now there’s a huge problem with this so-called shakeup because as I understand it, about 70% of people who have life insurance through their superannuation policy are not included in the changes. Is that right?
KB Not quite right. So basically. There’s been a report that’s established that of all of the…. sorry – all of the life insurance – approximately 70% of the people who are covered are covered through their superannuation. The problem that we have is that the policy – it’s no longer a draft policy. They had a very short consultation process and it’s been effective as of the 1st of October this year to be fully implemented by half way through next year. The problem that we have is, is that it specifically says that it’s not intended to put any obligations on financial advisors or planners or on the superannuation trustees.
CS Doesn’t that defeat the purpose if you’re having a shakeup of the industry, they’re the precise people that need to be shaken up.
KB That would be – that’s what we think is one of the major problems with the Code that’s come in – it seems fairly – there are question marks on how effective it’s going to be in the long run.
CS So what was the aim of the shakeup? What was the intention in the beginning?
KB Well I can only draw certain conclusions that it was that there would be perception that something was being done in the industry. How effective it’s going to be remains to be seen but it doesn’t look good so far.
CS Alright. It’s an interesting area and I should point out that a lot of people who are wishing to claim for some kind of disability or injury are often not aware of what’s contained in their superannuation policy. What is the usual framework within the superannuation policy for that purpose?
KB So as you say a lot of people think that they have it and they might not find out about it until they try and get some information. In the statements that come out once or twice a year, it usually will say on it whether or not you have certain types of cover.
CS They’re the ones that I get and I file straight away without reading them?
KB Exactly, those ones. It will usually say on them if you have got any sort of insurance attached, whether it’s death or total and permanent disability or sometimes income protection but you know the super funds don’t go out of their way to make sure that people know that they’ve got it. That sort of cover attached to their superannuation.
CS So total and permanent – or total or permanent disability is the usual way your superannuation is set up? Does it have that avenue usually?
KB Depending on the policy – yes – it’s common now for people to have. Insurance is attached to their superannuation.
CS And what does it allow you to do?
KB If you can demonstrate that you meet the policy then you are entitled to the level of cover that is associated with your policy and…..
CS So do you mean we have to read the fine print?
KB Yes of course. Hehehe
CS The fine print.
KB And you are also ……. If you can show that you are totally and permanently disabled you will also be able to access your actual superannuation balance as well.
CS And this is not reliant on you being injured in a workplace?
CS This could be you walking through a park or down the street?
KB Yes or having some sort of illness like cancer or multiple sclerosis or any other sort of injury or illness that your body decides is going to inflict on you.
CS So if I’m a cancer sufferer and I’m receiving treatment, what do I have to prove to be eligible to claim?
KB So, for a TPD claim what you need to be able to show usually is two things. First of all you have had at least the minimum period of time off work, which is usually between 3 and 6 months and secondly that you can convince the insurance company of the super fund that it’s unlikely that you are going to be able to return to a job for which you have the education, training and experience when you were last able to work because of your injury or illness. So with a cancer sufferer, it might be that some sort of income protection is going to be more useful. If it’s a short term thing that they have cancer and they are going to have to have a smaller amount off work but you know, they are going to be able…… they are going to be able to get back to work.
CS So you may be able to get income protection…..
KB If you have that….
CS For a period of 12 months for instance.
KB I think usually – again depending on the policy, they are usually anything from 12 months or 2 years up to age 65, but again that would depend.
CS And then you can – your circumstances might be that you could go back to work?
KB Potentially, yes.
KB That’s correct.
CS That’s interesting. So it can be a permanent support or a temporary support.
KB Yes – so the income protection and the total and permanent disability are usually two things. One thing that they sometimes call income protection is total and temporary disablement as opposed to total and permanent disablement. So they are there to look after you for discrete areas – income protection is good if you just need a limited amount of time off work because of a particular problem – you know – you busted your leg – or you’ve got cancer and you are going to beat it ….
CS And you’ve run through the 14 days the boss gives you off.
KB That’s right. You can run through that pretty quickly.
KB And then the TPD is sort of designed for a different purpose if you can’t go back to a job that you’ve done previously because of your injury or illness.
CS Okay is it incumbent on those who claim to prove that someone was negligent?
KB Not at all. Not at all. That sort of thing is more for if you have some other sort of injury, so it might be that you could prove someone else is at fault. That’s not relevant for the purposes of a superannuation claim.
CS I tell you what. Whatever we speak about the subject, it says a lot about all of us that continue on with our lives getting back into our file, pulling out all of those papers that we have received over the past 10 years/20 years and going over the fine print because it is so important when things go rife.
KB Absolutely. That’s right – and if you are in a situation where something is preventing you from going back to work at the moment, then it’s always a good idea to get some legal advice even if it is just you know something as simple as getting in touch with the super fund and saying – did this person have this type of cover or when they were last able to work.
CS To getting it clarified – yeah – Ozzie, you’ve got a question for Kerry – go right ahead.
Caller 1 – Ozzie
Ozzie Yes I have. Kerry – how are you?
KB Good thanks Ozzie – how are you going?
Ozzie Good – Kerry – I’ve got a …… my eldest son was involved in a severe motor bike accident 3 and a bit years ago – anyway the work that he was doing, he cannot do that work anymore – he’s with his superannuation fund – CBus and now he hasn’t worked – he’s now retrained himself – he’s doing architecture and he’s got two days a week of work but he wants to and then he then rang the superannuation fund and asked if you could make a claim on the TPD – and they said no because you’ve already started working again. Would that be correct?
KB In my view – probably not – certainly if you are able to go back and train into a different area that doesn’t necessary mean that you don’t still meet the insurance policy – I mean I don’t have a copy of the CBus policy in front of me, although I’ve made a fair few claims against CBus – it is usually important – What sort of work did your son do before he was injured?
Ozzie He was in construction – but he was a labourer in the construction industry.
KB Okay so he was a labourer before and now he’s retrained, so he’s an architect is that right?
Ozzie Yes – he’s basically lost movement in his – the bottom of his left leg.
Ozzie He can’t sit.
KB Yeah – I mean if he was able to prove that it was unlikely that he was ever going to be able to go back to work as a labourer, then it’s likely that he would meet the policy, as long as he had the supportive medical evidence there.
Ozzie Oh – he’s definitely got that – he spent 2 ½ weeks in a coma and 3 ½ months in hospital.
CS Ooh. Gee – alright Ozzie – all the best with that – is there any statute of limitations for someone like him?
KB Potentially, you would need to get it on as you possibly can – although usually the statute of limitations is more from the date that you knew that you had a claim – having said that – if there is any sort of question about this, try and just get some legal advice as quickly as you can about it – because you know you’ve probably got 3 years – 6 years.
CS Alright. We’ll take a break. Back with Kerry Byrnes and straight to your calls on 131 873.
CS Okay. Let’s get straight to our callers for Kerry. Steven, Kerry’s listening. Go for your life.
Caller 2 – Steven
Steven Yeah g’day. Thanks Chris. What I was ringing in regards to – I was just listening to you guys discuss about like income protection and then obviously the TPD which can be sort of looked at at a later point – my situation – I’m probably in the hospitality background – I’m a chef – so that ‘s all I’ve done pretty much since I’ve left school and I’ve had ……. I’m 38 and I’ve had 4 spinal surgeries…..
Steven In 5 years.
Steven And basically it’s been from no injury point – like I haven’t hurt myself at work it’s just basically they call it a degenerative disc disease where basically my discs and my spine just sort of start to deteriorate and so I’ve had the surgery – I’ve had two lots of income protection time off work – and they’ve been – the first one was 12 months and then the second lot was for a maximum period of 2 years and obviously after that 2 year period it ceases – I’ve had – when it came to the end of that time I spoke to the – my neurosurgeon, he recommended that I apply for my TPD because under his recommendation that I won’t be able to go back into my job.
CS Okay Steven I’ve got limited time – you’re applying now for your TPD payout are you?
Steven Yes I’ve done that – And….
CS And the question is?
Steven The question is basically with the time frame for it I’ve done all the paperwork and everything that’s required from the TPD and all the medical documentation that they’ve issued to me. Is there a limit as to how long this process goes out?
KB There aren’t any specific limit Steve but usually once you get to the sort of 3 month mar, you’d be starting to ask some pretty serious questions.
KB And it might be a good idea at that point to go and get some legal advice. Once you’ve given them everything they need and they are still not making a decision, it’s a good idea to start getting ……….
CS Put them in the frying pan Steven. And hey, listen, I’ve got a $100 voucher for you from Turner Freeman and Westfield alright.
Steven Oh, thank you so much Chris. It’s yeah – that pretty much makes my day at the moment.
CS Good on you – stay there Steven – you might want to talk to Kerry about taking this a little bit further. It’s 4 minutes away from news.