What might cause an insurance claim to fail?

Published 08 Mar 2017

In times of total and permanent disability or critical illness, it’s essential for people to have a consistent flow of income. If there’s any difficulty in receiving superannuation or insurance payouts, it can greatly impact a victim’s quality of life.

While superannuation lawyers can fight for a person’s right for fair compensation, it’s still important to know why a claim was originally rejected, and what can cause issues when an injury or illness occurs. Below are some of the reasons that superannuation claims are rejected by insurance companies.

The illness didn’t fall within the list of prerequisites

For people looking to make a critical illness claim, they to understand that these policies often come with a rigid list of excluded ailments. Unfortunately, it’s not enough to simply be sick to the point of being unable to work to receive compensation.

While the list of included diseases is fairly wide-ranging, afflictions brought on by self harm and extreme sports injuries will likely not be covered.

There are strict definitions for a particular incident

It’s easy to inadvertently ignore the fine print with an insurance policy and assume someone is covered in the event of specific illnesses or injuries. However, as one Australian man found out last year, some insurers have strict definitions for certain medical events.

In the incident in question, a man suffered a heart attack, died and was consequently resuscitated. Despite doctors confirming he had a heart attack, his insurer failed to pay out due to the fact he didn’t have certain levels of the hormone Troponin. Therefore, by his insurer’s definition, he didn’t actually suffer a heart attack.

The decision has since been repealed, and the insurer in question has changed its definition to ensure it doesn’t happen again, but the incident is a further reminder to read and review insurance policies when signing up and  making a claim.

The victim hasn’t been out of the workforce for long enough

In the event that someone has been injured and is unable to return to their previous job or one in a similar occupation, they can apply for a total and permanent disability claim. However, for this to be successful, the person has to be unable to perform the job they have the skills and qualifications for and have to wait for six months between leaving the workforce and making a claim.

If a person is over the age of 65 when they terminated their employment due to injury or illness, their claim will also be denied.

To find out more about the process of making a claim on your superannuation, get in touch with the team at Gerard Malouf & Partners Superannuation Lawyers.

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