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What to do if your TPD claim is rejected

Published on 16 June 202221 June 2023

If you’re unable to work due to injury or illness, you may be able to make a claim for Total and Permanent Disability (TPD) insurance through your superannuation fund. This insurance is frequently considered to be a lifeline for people who have lost their ability to earn an income, provide for their family and pay for medical expenses and future care needs.

Unfortunately, making a TPD claim is not always an automatic entitlement or a straightforward process. In fact, many claims are often rejected by insurers as they try to avoid making pay-outs.

This was reinforced by a comprehensive ASIC report in 2016 which investigated the life insurance industry, finding that disability insurance such as TPD claims were the least likely to be paid out, with up to 37% of claims being rejected.

Why do TPD claims get rejected?

While each insurance policy will have different requirements for TPD, some common reasons for a rejected claim can include:

The Insurer does not believe you satisfy the definition of TPD under the Policy;
The Insurer has obtained medical evidence that states you do not have an injury or illness;
The Insurer is of the opinion that you can return to some form of employment; and/or
You do not meet the eligibility requirements under the Policy.

Mental health claims are even more likely to be rejected, with a former executive of one of Australia’s leading insurers, TAL Life Limited, having his own claim rejected.

Mr Patrick O’Connor, who previously worked for TAL, was forced to leave his position in 2013 after developing severe anxiety and depression. In his case, the insurer initially rejected the claim on the basis that his condition was not severe enough to prevent him from returning to work that was within his education, training and experience.

What are my options if my TPD claim is rejected?

If your TPD claim has been rejected, you shouldn’t lose hope. Once you understand why your TPD claim has been rejected, there are several options available to review the Insurer’s decision – these include:

Submitting further evidence to the Insurer for reconsideration;
Lodging a formal complaint with the Insurer’s internal dispute resolution services;
Refer the decision to the Australian Financial Complaints Authority for review; or
Challenge the Insurer’s decision in Court.

Regardless of the insurer’s reason for rejecting your claim, it is crucial to seek urgent legal advice about your rights and entitlements.

Let Zaparas Lawyers help you

Navigating a TPD insurance claim can be a difficult and often overwhelming process. The Superannuation and Insurance Team at Zaparas Lawyers has a wealth of experience in successfully helping clients achieve the outcomes they deserve and ensure that they are supported through the entire process. We will do all of the hard work for you and ensure that your TPD claim is resolved as quickly as possible, so that you can focus on your treatment and recovery.

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If you are from Queensland you can learn more on our Queensland Superannuation Page