For many Australians, chronic illness is a reality of life. By definition, chronic illnesses last for a long time – sometimes indefinitely. In many cases, these illnesses can’t be cured and they have dire impacts on a person’s ability to work. Many people living with a chronic illness may be forced to take time off or leave their job to effectively manage their condition.

That’s where superannuation comes in. Did you know that superannuation insurance payouts can financially support those living with a chronic illness? In fact, you might also be entitled to a lump-sum payment through the secret insurance that you probably never knew you had – total and permanent disability (TPD) cover.

 

What TPD cover means for you

Under Australian law, industry super funds are required to include TPD insurance, but recent changes have now allowed members under 25 years to opt-out of default insurance cover. It aims to protect individuals who are forced out of work because of illness or injury – however, many people with a chronic condition are unaware that they’re even entitled to a lump sum benefit.

A common hurdle faced by those with a chronic illness is that many insurers ask you to disclose pre-existing conditions when you apply for insurance. This means you could pay a far higher premium or fall under an exclusion that makes you ineligible to make an insurance claim under a stand-alone policy.

However, many super funds offer TPD default cover as long as your condition doesn’t affect your ability to work when you first open the account. This means that if your condition gets worse and you’re unable to continue working, you may still be entitled to receive a lump sum.

 

But how do you know if you are eligible to receive a payout for disabilities?

You typically will have to contact your superannuation fund, or insurance provider, to find out what type of TPD cover applies in your policy. If in doubt, you can call the ATO and request a lost super search. The details of your cover could also appear on your superannuation statement, although it may be necessary to call or write to your fund to ask for specifics. Your insurer or super fund should also have a “product disclosure statement” available for you to read, which should clearly set out what you are covered for and how the claims process works.

If your TPD is with a superannuation fund, we also recommend checking:

  • what type of insurance cover you have
  • how much cover you have
  • how much you are paying for the cover

If you don’t feel the benefit is enough, apply for additional cover.

 

Your checklist for TPD

To ensure you have the right TPD cover:

  • Call your fund and check your coverage as described above
  • Assess your personal and financial situation – if you were to be permanently injured or severely disabled, will you and your family have enough income to survive and pay off any debts?
  • If you need more TPD insurance, either apply for more via your fund or consider linked or standalone policies outside of super.
  • Read the definitions, exclusions and release conditions closely in the PDS document to ensure there are no nasty surprises should you ever need to make a claim.

As TPD claims can be quite complex, it’s very important to contact WKB TPD Lawyers on 1800 865 225 or visit our website www.wkblawyers.com.au to see if you may be eligible. WKB TPD Lawyers are not a generalist personal injury firm. In fact, we only do TPD claims.