TAL urges terminal illness changes

Major insurer TAL has urged changes to superannuation fund preservation rules that require two medical practitioners to certify terminal illness and life expectancy.

The company has used an answer to a question on notice from the Parliamentary Joint Committee on Corporations and Financial Services to argue the case for change.

The TAL answer said that, in the company’s experience, it was extremely rare for there to be a disagreement between it and its trustee partners in relation to a claim which has been admitted by TAL.

“Where a claim has already been assessed as being payable by TAL, a trustee is unlikely to challenge this decision. This is because a trustee’s focus is its members’ best interests and the trustee’s obligation under s52(7) of SIS Act to do all that is reasonable to pursue a claim for the benefit of a beneficiary where that claim has a reasonable prospect of success,” it said.

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The company said the area that remained an issue in relation to approved claims was the requirement in the preservation rules that required a member who claimed a terminal illness benefit to provide opinions from two registered medical practitioners that they are terminally ill and that their life expectancy is less than two years.

“Given the due diligence that surrounds the acceptance of a terminal illness claim TAL is generally comfortable with sign-off by one medical practitioner,” the company said.

However, it said the Superannuation Industry (Supervision) Act (SIS Act) required funds to obtain two medical practitioners (one of which must be a specialist practising in an area related to the illness or injury) to certify compliance.

“It would be useful for the SIS definition to be amended so that only one medical practitioner is required to certify the terminal illness,” the submission said.