The Federal Government would need to change no fewer than four Commonwealth acts and then implement new legislation and regulation if life/risk insurers were to be allowed to have greater involvement in worker rehabilitation.
That is the bottom line of a submission filed by major insurer AIA Australia Limited, which claimed that allowing private sector life insurers to have greater involvement in worker rehabilitation would “help create a more complete system for supporting those who have an injury or illness that is impacting their ability to work”.
It said that to allow life insurers to fund medical treatment and medical expenses, amendments would need to be made to the Life Insurance Act 1995 (Cth), Private Health Insurance Act 2007 (Cth), Private Health Insurance (Health Insurance Business) Rules 2017, Health Insurance Act 1973 (Cth), the Superannuation Industry (Supervision) Act 1993 (Cth) and the Superannuation Industry (Supervision) Regulations 1994.
The submission said these legislative changes would then need to be supplemented by “principles that protect consumer interests and provide guidance and clarity. These principles should be included in regulations or otherwise included in the Financial Services Council Life Insurance Code of Practice”.
Confronted by trade union and consumer group opposition to the proposal, the AIA submission, filed with the Parliamentary Joint Committee on Corporations and Financial Services claimed, “allowing life insurers to fund medical treatment and medical expenses for eligible claimants under a continuous disability policy will help to minimise existing gaps in our income support and healthcare system that may restrict or prevent effective return to work”.
“The proposed changes are intended to complement, not replace, existing income support and healthcare systems,” the submission said.
“Allowing life insurers to fund medical treatment and medical expenses will deliver Shared Value. That is, it will create benefits for individuals and their families, Government and society, and life insurers. It is a win-win-win solution,” the AIA submission said.
In my experience, when you unpack what AIA really wants to do, which is currently being poorly tested on Sunsuper members, the sole purpose results in imposing a further hurdle and ability for life insurers to delay, deny and defend legitimate TPD and IP claims.