A recent determination by the Superannuation Complaints Tribunal (SCT) has underscored the recent calls by the Association of Superannuation Funds of Australia (ASFA) for greater clarity around total and permanent disablement (TPD) definitions.
Dealing with a decision by a superannuation fund and an insurer to deny a former policeman suffering post-traumatic stress a TPD insurance pay-out, the SCT relied heavily on the policy definition to deny the claim.
The former policeman had sought the TPD payout on the basis that he was no longer able to work in law enforcement but acknowledged that he had obtained work three days a week as a driver.
The SCT also took into account the evidence of medical practitioners that the 46-year-old policeman could no longer work in law enforcement but, over time, might be able to return to work in some other calling.
However, it was the question of the TPD definition that the SCT’s approach proved crucial.
The Tribunal determination noted the three key words in the insurance policy’s TPD definition, namely: “unlikely”, “ever”, and “gainful profession, trade or occupation”.
It said these keywords were to be interpreted as: ‘unlikely’ — “meaning a probability of less than 50 per cent”; ‘ever’ — “the decision maker is required to look well into the future”; ‘gainful profession, trade or occupation’ — “part time work will satisfy, so long as it is remunerative and regular”.
The determination stated: “when the key words are considered in conjunction with the medical evidence, the Tribunal does not believe it is possible to conclude that the Complainant, currently aged 46, satisfies the policy definition of TPD”.
DOD ~ may I suggest t’s likely there wasn’t an adviser involved with this claim as it was most probably an Industry Super Fund group policy. Hence the value of having a trusted financial adviser regardless!
Clearly the right decision, Who was the advisor who suggested to this guy that it was even worth making a claim? There are ‘same occupation’ type definitions available but of course that cover costs more.