Many Australians are unaware that they have Total and Permanent Disability (TPD) insurance cover within their superannuation account.
What is Total and Permanent Disablement (TPD) Insurance Cover?
TPD insurance cover is a lump sum benefit payable in the event that you suffer an injury or illness which leaves you ‘unlikely ever’ to be able to return to the type of employment that you are suited to by education, training or experience.
TPD is intended to partially compensate you for the loss of superannuation which you would otherwise have accumulated if you were able to continue to work to retirement age.
Am I eligible to make a TPD claim?
Whilst the definitions of TPD vary between different insurers or Superannuation Funds you will generally need to demonstrate the following in order to be eligible to claim:
- That you have been absent from all work for a minimum period of at least 3 to 6 months as a result of illness or injury (some illnesses or injuries hold no waiting period); and
- Based on the available medical evidence, it is ‘unlikely ever’ that you will be able to return to work that you are suited to by education, training or experience.
Cover provisions and exclusions
Many insurance or superannuation policies do not provide TPD cover if the Member was not in ‘active employment’ in the 12 months prior to becoming disabled/ceasing work due to medical incapacity. There are some policies which do include provisions for such Members if they are unable to perform certain personal care tasks or activities of daily living such as: dressing: bathing; showering: feeding: toileting; and/or walking.
TPD claims within superannuation
In TPD claims within superannuation it is not necessary to prove how or why your injury or illness occurred. Generally, it does not matter if you have exhausted all other entitlements to workers compensation or motor vehicle accident compensation etc, or have a pre-existing injury or illness, providing you were covered at your ‘date of disablement’.
Do I have TPD cover within my superannuation?
If you have multiple superannuation accounts, you may have multiple TPD insurance policies. It is possible to claim on more than one policy however there are sometimes exclusions and conditions which apply.
It is important to establish all potential entitlements and check the policy documents carefully before proceeding in order to maximise your benefits.
In order to establish whether you may have cover within your superannuation, as a starting point you can check a copy of your superannuation statement at the time you ceased working due to medical incapacity. Your TPD (and any other insurance cover, including Income Protection and Death Cover) should be listed under an ‘Insurance Cover‘ section.
Where to next?
For assistance in establishing any Total Permanent Disability entitlements you may have, or any TPD insurance related enquiries, please contact Senior Associate Hayley Gagin, who specialises in TPD Claims and heads the DBH Lawyers TPD Team.
Hayley can be contacted by telephone on (08) 8216 3378 or by email at email@example.com.