As with most things in life, it depends what you mean! 

If you mean, is Total and Permanent Disability (TPD) insurance worth having and worth paying for, then yes, absolutely! 

If you mean, is TPD worth claiming, if you are unlikely to return to work within your education, training and experience then yes, you absolutely should! 

Read on.

Worth having?

Sadly it’s a fact that Australians are a very underinsured nation. 

In fact, when it comes to life insurance, Rice Warner’s Underinsurance in Australia 2020 report found the current level of insurance held by Australians covers 92% of basic death needs, but only 29% when it comes to total and permanent disability (TPD) insurance. 

According to Rice Warner’s 2017 research, the typical cover for the 94% of Australians who had some level of life insurance was estimated to be about $143,500, or about double the median household income. Rice Warner determined that the required sum for same levels of cover is eight times the average family income.  

Total and permanent disability (TPD) and income protection (IP) coverage are much less common in Australia than life insurance, according to Rice Warner. This is because most people have access to life insurance through their superannuation and certain funds do not provide TPD or IP as a default. 

While default life insurance through super can be an efficient and sometimes less expensive approach to ensure that many working Australians have some level of coverage, it is not a personalised plan, so you may find yourself underinsured. The cost of premiums deducted from your superannuation will also lower your balance, which will have an impact on how much is invested and leave you with less money in your fund when you retire, therefore the impact of this against the cost of paying premiums separately must be considered. 

Unfortunately, I speak to too many Australians who find themselves underinsured after they need their insurance.

As such, if you are still fit, healthy and at work it’s worth obtaining independent financial advice about your insurance. 

Worth claiming?

If you are off work because of injury or illness, regardless of how it happened, and you are unlikely to return to work in your usual occupation, you may be a good candidate for an income protection or total and permanent disability claim. 

IP and TPD is designed to help people who find themselves out of work and in tough financial situations, so if you are struggling it is worth reaching out to determine your entitlements. 

Remember, it’s likely you have been paying insurance premiums without even realising so you’d be mad to not claim if you’re eligible. 

How to claim?

Know your rights.  

If you are yet to make a TPD, you are entitled to legal representation and Littles can help you. 

If you have already lodged a claim and it has been rejected by a superannuation fund or insurer, you may be entitled to have the decision reviewed through an internal resolution procedure. 

If your complaint has been upheld, you may be able to litigate in a court or lodge a complaint with the Australian Financial Complaints Authority (AFCA). 

There are strict time limits to challenge an insurer’s decision, so it’s important you seek legal advice as soon as possible.

What is the Littles difference?

Put simply, Littles are experts in superannuation and insurance law matters.  

Our insurance team has helped thousands of consumers claim their entitlements, and our Head of TPD and General Insurance has extensive industry knowledge and insight on how to maximise your prospects of success. 

We also speak your language, at sixteen languages and counting.  Forget paying for a translator or for a lawyer who doesn’t understand you and your cultural background. 

All our superannuation and insurance law matters are conducted on a no win, no fee basis, and we don’t charge you upfront for any disbursements necessary to prosecute your claim. 

If you would like superannuation and insurance law advice, reach out to Littles today by using our free Claim Checker. 

About the author

Littles’ Head of TPD and General Insurance, Rowan McDonald, is an expert in insurance and superannuation law.  Rowan is an experienced litigator and has prosecuted thousands of successful insurance claims for consumers. 

Having worked in the insurance industry for over fifteen years, Rowan has an extensive industry contact list and regularly presents to disability support groups, financial industry professionals and multicultural organisations.  

Rowan has also advised some of Australia’s top insurers, giving him unrivalled insight into the claim process from all perspectives.  Rowan takes a pragmatic and common-sense approach to the advice he provides his clients. 

For your free, personal consultation get in touch with Rowan today.  

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