TPD Claim Process Guide

What is a TPD claim?

Injury or illness can make it difficult or impossible to return to work.

TPD stands for total and permanent disability. A TPD claim is an insurance benefit that you may claim if you are unable to work due to injury or illness. It is a lump sum paid in addition to your superannuation contributions.

What does TPD insurance cover?

TPD insurance is insurance cover through your superannuation policy, which is usually a lump sum payment if you suffer serious illness or injury and are unable to work.

TPD insurance can provide a financial safety net against total and permanent disability by providing a lump sum to help support you and your family and pay for medical and rehabilitation expenses.

Who is eligible to make a TPD claim?

You may be eligible to make a TPD claim if you have TPD insurance and;

stop working due to injury or illness;
stop working for an extended period of time, usually 3 or 6 months;
are unlikely to work again in a field that you are qualified in.

Important Each policy has different definitions and provisions, so you will need to check your policy to clarify whether you are eligible to make a claim. Contact us for a free claim check and find out if your are eligible based on your policy from our TPD lawyers.

What exactly is a total and permanent disability?

Each insurer has a different definition of what it means to be totally and permanently disabled. Generally, you may satisfy your insurer’s definition of TPD if you’ve been unable to work due to injury or illness for a period of time (usually 3 or 6 months) and are unlikely to return to work in your occupation or any occupation.

In some instances, it can cover you for either:

your occupation – where you are unable to work again in the occupation you were working in prior to your TPD.
any occupation– where you are unable to work again in a job where you have education, training or experience.

Getting advice and clarity around your insurer’s TPD definition and your eligibility by one of our TPD lawyers will be invaluable to you.

How to make a successful TPD claim?

Understanding the TPD claims process will enable you to make a successful TPD claim and mitigate the likelihood of having your claim denied.

Each superannuation fund has its’ own claims process. However, in general, you will be required to contact the superannuation fund and complete the required forms before the fund makes an initial assessment. The superannuation fund will then provide your TPD claim to the insurer who will assess your claim and make a decision.

To get your TPD claim approved you will need to complete the application as thoroughly as possible and provide all documents in support of your claim, including but not limited to clinical notes and worker’s compensation files. Since our TPD lawyers have successfully lodged many TPD claims, we know what the superannuation fund and insurer are likely to request in advance, that will avoid the lengthy and time-consuming back and forth process with the fund and assist you to get a successful outcome quickly.

It is also important when submitting your TPD claim and documents that, you don’t make errors or inconsistencies as this may put the success of your claim in jeopardy.

Can the insurance company reject my TPD claim?

There is a chance that your TPD claim may be denied. That’s why knowing the reasons a claim may be denied may assist in avoiding denial. A TPD claim may be denied for one or more of the following reasons:

not meeting the policy definition;
not satisfying a work history requirement;
the evidence you’ve provided may be disputed;
not meeting the minimum waiting requirement;
your policy becoming inactive because you haven’t kept up the premium payments, closed your account or it has lapsed;
Lodging your claim outside of time;
Errors or inconsistencies in your evidence.

What are the most common injuries and illnesses for a TPD claim?

There are a range of illnesses and injuries that may qualify for a TPD claim, including but not limited to

Physical injuries

Psychological/mental health

Anxiety
Depression
Bipolar Disorder
Post-Traumatic Stress Disorder (PTSD)

Neurological disease

Multiple sclerosis
Motor Neurone Disease
Cancer
Muscular Dystrophy

How does the TPD claim process work?

How long does it take to get a TPD payout?

The length of the claim is dependent on a number of factors including its’ complexity and how much information is required.

As a general rule, it takes 6-12 months for a TPD claim to be finalised. A straightforward claim is more likely to be finalised sooner, however, the more complex claims often take longer than 6 months to make a decision.

Can I claim a TPD payout from more than one superannuation fund?

If you have multiple superannuation funds, you may have multiple TPD policies and be able to make multiple claims. If this is the case, you will be required to submit a separate claim against each policy bearing in mind each policy’s requirement.

How to make a TPD claim step by step?

Step one – identify all of your superannuation policies

If you are unsure which superfunds you could be a member of please contact our TPD lawyers who will be able to assist you in identifying which superfund you could be a member with.

Step two – check the policy validity at the time of your injury/illness

To make a TPD claim you must ensure that you had valid cover at the date of your injury or illness. This is not always black and white, as the date of injury or illness may be one that occurred over time. Our TPD lawyers during our free claim check will be able to check whether it is valid and whether you will be eligible prior to you making the TPD claim.

Step three – Read and understand the TPD policy

You should read the policy throughly to identify what is required to receive a lump sum payout.

Step four – Submit your TPD claim including thoroughly completed forms, attachments and medical records

Step five - Prepare written submissions

The submission should be detailing why your TPD claim satisfies the criteria in the TPD policy and why it should be approved.

Step six – Be proactive

Follow up with the insurer to avoid unnecessary delay

Step seven – If your claim is denied, follow up the dispute process.

If your TPD claim is denied, you may dispute the decision. Our TPD lawyers have successfully disputed many claims on behalf of our clients.

Why should I use a lawyer for my TPD claim?

TPD claims can be complicated. Many people use the services of TPD lawyers to manage their claims on their behalf. Our TPD lawyers understand the process, and the evidence and information required to get your TPD claim approved, in the shortest period of time.

TPD Payouts

How is a TPD payout calculated?

The amount of TPD you receive depends on how much coverage you purchase and is specified within your policy. Typically, they range between $70,000 to $2,000,000.

If your TPD claim is successful, you may be given the option to withdraw this amount in addition to your superannuation account balance. It is important, however, to recognise that there may be financial/tax implications depending on specific factors. Although our TPD Lawyers are unable to provide you with financial advice, we can assist you in ensuring you get the right advice prior to withdrawing your TPD benefit.

Do you pay tax on TPD insurance payout?

If your TPD claim is successful, it will be paid into your superannuation account and added to your account balance.

Your TPD payout is not considered taxable income however if you withdraw any part of your TPD payout from your super fund as a lump sum, then you will be liable to pay “superannuation lump sum withdrawal tax”. The amount payable varies for each person and if you have multiple TPD claims.

When you go to withdraw some or all of your TPD payout, the following is considered when calculating your “superannuation lump sum withdrawal tax”:

If you are 60 or over, there is no tax payable
If you are under the preservation age, – which is 55 and 60 depending on your date of birth- then you will pay tax on a portion of it and a tax-free portion will be calculated.
The standard tax rate is 22% HOWEVER when you make a withdrawal, the superannuation fund will calculate a “tax free uplift”, meaning a portion of your withdrawal will be tax free. The calculation will take into consideration your Eligible Service Date and age, as well as the date last worked.

Do TPD payouts affect Centrelink?

Centrelink is complex and obtaining further advice is highly recommended. In short, approval of a TPD claim will not impact your Centrelink entitlements as it will initially be paid into your superannuation account.

Important When you go to withdraw your TPD benefit/or superannuation, then your Centrelink entitlement may be impacted.

What to consider when withdrawing your TPD benefit?

Before you withdraw your TPD benefit, you should consider the following:

The tax implications that it will have for you.
The implications that it will have on your Centrelink Pensions and Allowances including but not limited to Newstart, Disability Support and Family Tax Benefits.

Although the above may seem overwhelming, however, our TPD lawyers will assist you every step of the way and will work with you to ensure you understand your position before you withdraw your TPD benefit.

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