Published 13 Jun 2017
Total and permanent disability (TPD) insurance provides a financial safety net for people who suffer an accident, illness or other incident that prevents them from working.
TPD cover is often included in an individual's superannuation benefits, with members able to receive a lump sum payment and the early release of their retirement savings if they are deemed permanently disabled.
However, insurers may be collecting considerable payments for TPD insurance from people who are either ineligible for cover or highly unlikely to win when they make a claim. This is particularly true for casual workers, according to a recent ABC News exclusive.
The trend may affect a significant number of workers, with Australian Council of Trade Unions data estimating that approximately 2 million people in the country are classed as casual labour.
Why aren't casual workers covered?
Permanent and temporary employees are typically measured against different thresholds when making TPD claims.
Full-time workers can receive a payout if they are able to prove they are unable to return to their previous occupation or any other job that they have the qualifications, education or experience to perform.
Meanwhile, casual workers must meet criteria under an 'activities of daily life' test, which means they will be rejected unless they require help with basic day-to-day tasks, such as going to the toilet or getting out of bed.
Professor Thomas Clarke, head of the Centre for Corporate Governance at the University of Technology in Sydney, told ABC News that many people are unaware they are paying for insurance that won't provide cover when needed.
"It's totally unethical and it denies any duty of care on the part of the insurance company to provide a person with the insurance that the person they're providing the insurance to thinks they have," he explained.
Maximising your TPD claim chances
Recent Australian Securities and Investments Commission data showed that 16 per cent of TPD claims are rejected, the highest proportion of any life insurance product.
Insurers often turn down benefits for legitimate claimants, which is why you should consult with superannuation dispute lawyers to see whether or not it's worth pursuing your case further.
Experienced no-win, no-fee lawyers will ensure that you have the best chances of succeeding in your claim by collecting evidence on your behalf, filing the appropriate paperwork and representing you in court.
Please contact Gerard Malouf & Partners Superannuation Lawyers for more information.