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TPD and other disability insurance considerations for people with chronic illness but still working


TPD and other disability insurance considerations for people with chronic illness but still working

Many of our blogs focus on giving advice about TPD claims to people who have ceased work due to injury or illness. However, this blog is aimed at assisting people who are still working after being diagnosed with a chronic illness. The work we do focuses on assisting these people to make sure that they protect their insurance coverage, like TPD, income protection and trauma insurance, in case they have to stop working due to illness in the future.

We do a lot of work with people who have been diagnosed with a chronic illness, like MS and continue to work after the diagnosis. In this blog, we explore some of the most important things to keep in mind when working after the diagnosis of an illness to make sure that you can claim on your insurance in the future if you have to stop working due to your illness.

Make sure your employer makes regular contributions to your super

Most superannuation-based insurance policies, whether for TPD or income protection, require that you make regular contributions to your super account to keep the insurance coverage active.

Also, under legislation, you must either be actively contributing to the account or must make an election to keep your cover active (in the absence of ongoing super contributions) to have disability insurance coverage.

We have worked with a bunch of people who have lost the benefit of their super-based insurance cover because they have either:

  1. deliberately stopped making super payments (eg. self-employed people);
  2. started making employer contributions to new super accounts and lost the cover in their old account because they were no longer making contributions; or
  3. their employer stopped making super contributions (or stopped making regular contributions, which can also adversely affect insurance cover.

If this has happened to you, you may need to apply for your insurance to be reinstated which will often require you to answer invasive questions about your health.

If you have already been diagnosed with an illness or have symptoms of an illness, you may not get cover or you may get cover with exclusions. Also, if you do not answer the questions accurately and this is later discovered by your insurer, any claim you make in the future may be rejected, and the policy may be avoided.

Consult with your doctor

Many people with chronic illnesses or injuries battle on and put all their energy into working hard to meet financial commitments. In doing so, you may neglect other parts of your life and general health and well-being. This can include not consulting with your doctor regularly, particularly if you suffer from a chronic illness which the doctors are not able to effectively treat.

However, if you do soldier on with work despite illness and ultimately decide to stop due to your illness, regular attendance with a doctor and a good relationship with them can be a requirement to successfully claim a disability benefit like TPD. It can also be key to proving that you actively stopped work due to illness years after a diagnosis. This can be particularly problematic to prove if you stop working due to your illness without a frank incident (eg. a fall or a relapse).

When is it crucial to get TPD and disability insurance advice?

Get advice before changing work duties or hours

Sometimes, to keep your insurance cover going, you must be working (or capable of working) your normal work duties or hours without restrictions to maintain your insurance cover. In other cases, your cover will continue, but the definition that your disability claim is assessed under will change if you are working in a restricted way.

For this reason, if you are changing your work duties or hours due to illness, you should seek legal advice. We will check your insurance terms and conditions and give this advice without charge.

Call for free advice Australia wide: 03 9448 8048

Get advice before making changes to your insurance coverage

It may seem obvious, but changing your insurance terms (changing the amount of cover you have) can impact on your ability to claim in the future.

We have helped heaps of people who have reduced their insurance coverage or changed their policy terms to get cost savings. You should always get advice before making these changes, particularly if you have an existing injury or illness.

Get advice before moving your superannuation from one fund to another

Changing super funds can mean that the cover you had in your old account for TPD or IP is no longer active. This may be OK if you are well and get new cover, but if you have to apply for cover in the new super fund, and this requires making health disclosures, this can lead to exclusions, denials and possible non-disclosure issues.

Also, many people assume that old and new super funds have an obligation to make sure insurance entitlements are transferred when you move your super balance. This is not normally the case and moving your super to save on fees can cost you a small fortune in lost insurance entitlements. Therefore, you should always get advice when switching super funds, particularly if you have existing health conditions.

Get help from a disability insurance lawyer

If you have an existing health condition and are looking to make changes to your work to accommodate that condition, you can get in touch for some free advice. We will need to review your policy and let you know what impact (if any) the changes will have on your insurance cover. This is a free service, so get in touch!

Contacting Berrill & Watson

📞 Melbourne: 03 9448 8048

📞 Brisbane: 07 3013 4300

📞 Anywhere else in Australia:  03 9448 8048

📧 [email protected]

How we charge

We are Australia's best-value superannuation/insurance law firm. Other law firms charge nearly double (& sometimes more than double) what we charge. So, if you get a quote from them, or have a cost agreement, ask us what we will charge you.

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