When you have a lawyer running a TPD claim, it is more likely that the evidence in support of the claim will be properly prepared and satisfy the definition clauses in the policy. In many cases, a person will only get one shot at accessing their full entitlements when claiming TPD benefits. Attwood Marshall Lawyers Compensation Law Partner and QLD Law Society Accredited Specialist in Personal Injury Law, Jeremy Roche, explains why TPD claims are not as simple as they may seem.
Introduction
At Attwood Marshall Lawyers, our compensation law team regularly see clients who have already tried to lodge their own TPD claim, or who have had the assistance of a financial planner to lodge their claim only to have the claim rejected by the insurer. Unfortunately, in many cases, by the time the client seeks legal advice from us, their claim is a mess, sometimes unnecessarily, which causes significant delay and complications to access the benefits they are entitled to. Once a claim has been rejected, starting from scratch can be extremely time-consuming and costly for the client.
Having a specialist compensation lawyer who knows what they are doing involved from the beginning means a claim can be run relatively stress-free from the client’s perspective with minimal effort from their end. They have enough to worry about if the injury or medical condition has stopped them from working! Quite often there are significant amounts of lump-sum payments available and it is very important to get the application just right. It needs to be supported by the right medical evidence as well. Sometimes, this means briefing expert medical specialists in this area to obtain reports which assist the claim.
What is involved when lodging a TPD claim?
Many people (including lawyers!) think that lodging a TPD claim is just ‘filling out a few forms’ or ‘paperwork’. Nothing could be further from the truth! In many cases, there is always an issue with whether a client meets the policy definition of ‘total and permanent disability’. Insurance companies love to find an excuse to deny a claim, particularly when there is a large sum of money on the line!
Insurance policies are complex, and the definition of total and permanent disablement (TPD) varies between super funds and insurers. Prior to lodging TPD claims, our lawyers fully assess policy clauses to ensure the client meets the required eligibility and definition requirements.
What we often see is that many clients (and/or their financial planners) are unaware of clauses or interpret the terms and conditions incorrectly which may deem them ineligible to claim. For example, some policies have clauses in relation to the minimum working hours required per week in order to make a claim. Some clauses deal with restrictions on ‘activities of daily living’ that change after a certain age. Despite these clauses (which are clear to us as legal practitioners), we find claims being lodged by clients that are subsequently declined for obvious reasons.
Given we deal with and fight these insurance companies on a daily basis, we understand how claims are processed and what is required to have the claims approved. We have access to a range of highly experienced doctors and health practitioners to assist with preparing relevant medical reports which are required to support a TPD claim.
We find the most important aspect of a successful TPD claim is ensuring the initial submission paperwork is thorough, completed correctly, and supporting medical reports have been completed appropriately by the treating medical practitioners. If needs be, expert reports can be obtained. For clients, this can be an extremely stressful process that overwhelms them and drowns them in paperwork. Having a lawyer to support them throughout the claims process means the client has minimal involvement and can concentrate on their health and wellbeing whilst their lawyer does the leg work.
Ultimately, for a successful claim to be achieved, the client needs to be able to prove that their disability is total and permanent, that they have fulfilled any waiting periods that apply to their policy, that they are unable to return to work, and that they are complying with the medical advice and care they have received.
Gathering evidence to prove the above is key and leaving out a simple report or completing a document incorrectly can ultimately cost a client their claim.
What happens if a TPD claim is rejected?
If an insurer rejects a claim usually a long and technical letter is sent to the individual explaining why their claim has been ‘declined’. This letter usually sets out medical evidence that goes against the individual’s TPD eligibility. Alternatively, the insurer may have found a pre-existing condition or non-disclosure issue. These letters can be overwhelming and leave the client feeling like they have no option to object.
There are various options for objecting to a ‘declined’ decision including internal reviews with the insurer, taking the matter to AFCA and finally, court proceedings.
Given the technical jargon used in decline letters, some claimants simply give up and take what the insurer says as accurate. Once again, nothing could be further from the truth in many cases! Insurance companies love declining claims. It saves them a lot of money if the client does not challenge the decision.
When a client attends our office with a declined claim, our first step is to obtain a full copy of the claim file and thoroughly review all documents that have been lodged. Sometimes it is clear that a document has been completed incorrectly or a more technical argument is required. From here, we advise the client as to what steps we recommend in order to come to a solution.
It is important that if a claim is declined, clients seek legal advice as soon as possible as time limits apply for both AFCA and court proceedings.
Why as a financial planner/accountant, you should not lodge TPD claims
Under recent ASIC changes, from 1 January 2022, if you provide claims handling and settling services to clients, you must hold an Australian Financial Services (AFS) licence authorising you to do so. Whilst financial advisers are exempt from this requirement, there are many financial firms that use in-house claims administrators to lodge superannuation and insurance claims such as TPD claims. These individuals do require a relevant licence. To avoid any fines to you or your business, it is important that you are aware of the ASIC requirements and ever-changing legislation.
Should you provide legal advice whilst assisting a client with lodging a TPD claim, this can be seen outside of your financial practising scope. You may well be putting yourself in danger of a professional negligence claim being made against you for providing ‘legal advice’. You may find that your professional indemnity insurance policy does not cover you for this ‘advice’. The last thing you need is another argument over an insurance policy! Whilst your professional financial/accounting expertise plays a role in TPD claims, for example when clients are deciding to withdraw or invest funds once claims are accepted and they have received their benefits, legal advice is outside the realm of financial planning.
The risk with some financial advisers is that they push for one solution regardless of needs, pressure clients into signing documents that they haven’t read or don’t understand, provide advice that doesn’t fit with your goals or risk tolerance, they make client’s feel intimidated or uncomfortable when asking questions, aren’t always upfront as to how they make their money and the cost of services; leave client’s in a worse financial position, and charge for advice that they never provide. If a client is not happy with the service, they have received they can complain through Internal Dispute Resolution, alternatively Australian Financial Complaints Authority, the Advisor’s Industry Association, Police or ASIC if you suspect fraud or dishonesty.
To read about actual circumstances where ASIC have taken financial services companies to court or cancelled their licenses, read the following articles:
ASIC takes AMP Financial Planning to court
ASIC cancels Queensland group’s AFSL
What does it cost for Lawyers to handle a claim?
Most lawyers charge by hourly rates. This means that you pay for how long it takes to get the claim through. The more complicated the claim is, the higher the fees are. However, in many cases, lawyers agree to charge a fixed fee for this service and take on the case on a ‘no win, no fee’ basis. This means the claim is handled at no cost to the client unless and until there is a successful outcome to the claim. We take on most of our TPD cases on this fixed fee, no win, no fee basis. Give us a call to discuss any claim you may have for a client free of charge. We can also help you with any claims that have already been lodged or have been declined.
Attwood Marshall Lawyers is a leading compensation law with a specialist team dedicated to assisting clients to make TPD claims
Attwood Marshall Lawyers are experts in TPD and superannuation claims. We have been helping injured people for over 75 years to obtain successful compensation for their injuries and medical conditions. We understand that when someone is at a stage in their life that they are applying for TPD benefits, they have already gone through turmoil and significant life changes. We want to ensure that our clients can access their full entitlements as quickly as possible so that they are able to move on with their life and focus on what matters most, their health, their family, whilst having financial security. After all, no one wants to spend days, weeks, or months dealing with insurance companies who ultimately do everything in their power to reject valid claims.
Our Compensation Lawyers are readily available at all our office locations at Coolangatta, Robina Town Centre, Kingscliff, Brisbane, Sydney and Melbourne, and can be contacted any time on 1800 621 071.
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