Claim Your Superannuation
We are all familiar with the superannuation system in Australia. Once you are 18 or over and make $450 or more before taxes per month (or, if under 18, you make at least $450 and work more than 30 hours a week), your employer is required to pay superannuation contributions into a ‘super account’. These contributions are separate from your salary or wages.
The main purpose of superannuation is to ensure Australians have an income stream after they retire. It has been a very successful program, with many choosing to supplement their employers’ compulsory superannuation with voluntary contributions, often by diverting portions of their wages to their super account. But many of us are unaware we can access our superannuation funds in instances other than retirement. If you are unable to work due to injury or illness, whether temporary or permanent, you can withdraw your superannuation early.
Types of Superannuation Disability Claims
Total and Permanent Disability (TPD) Claims
Total and permanent disability insurance is a resource made available to workers who are permanently unable to continue in their area of expertise due to injury or illness. It comes in the form of one lump sum payment, and can often be received in addition to any other settlement (example CTP claims under the Motor Vehicle Accident Act).
Types of TPD Insurance
‘Area of expertise’ is an important distinction. Although you may still be able to work in a completely unrelated field, if your injury permanently affects your ability to work in your field, you will often still qualify. There are two main types of TPD insurance:
Own Occupation:
Due to your injury, you can no longer perform the specific role that you most recently held. E.g. Due to a paralyzed hand, you can no longer operate as a surgeon.
Any Occupation:
This applies when illness or injury results in you being unable to perform any job in line with your experience, education or training. E.g. Due to a traumatic brain injury, you can no longer perform not just as a surgeon but at all in the medical field.
This may be one of the most important TPD distinctions and one you must be very aware of. With 'own occupation' coverage, you need only prove you are unable to perform your specific job in order to receive benefits. Under ‘any occupation’ coverage, if the insurer can successfully argue you can theoretically still work within your general field, they can deny you coverage. For example, in the aforementioned case, the insurer could argue the surgeon can now work as a general practitioner.
There are also policies that cover home duties. For example, a stay-at-home father who becomes seriously ill may no longer be able to take care of the family’s children and perform other necessary tasks. TPD can cover the expenses of acquiring at-home help. Similarly, the Modified TPD is often claimed when an individual’s illness or injury requires assistance in everyday personal tasks (hygiene, at-home nursing, personal assistance etc.). These are known as ‘Non-Occupational’ policies and the claimant must typically be unable to perform 2 of 5 everyday activities.
Criteria to Receive TPD
Unlike the various types of income protection, total and permanent disability comes in the form of one lump sum payment. With such large payouts, TPD providers look very closely at their chosen criteria even when agreeing to a payout. These criteria vary depending on the provider, but there are some common ones, including:
Severity of Disability:
To receive TPD, you must prove that your illness or disability is severe enough to prevent you from performing in your field for the rest of your life.
Stability of Condition:
If your insurer feels that your illness or disability is more serious because its onset was recent, they will often choose to wait as long as possible to see if it improves.
Medical Certification:
Most employers will require some sort of certification from a reputable medical professional that you are, in their opinion, permanently disabled. Insurers may include stipulations that they can request a second opinion from a practitioner of their choosing.
Time Unemployed:
Many insurers include a requirement of minimum time unemployed due to your disability. Most often, this will be about six months.
Employment History:
This is a criterion that can unexpectedly prevent you from receiving TPD benefits. Often, you will need to have satisfied a certain minimum time of employment. This may be how long you were employed as a whole, or it may be a requirement of having worked a certain number of hours a week.
Type of Policy:
This refers to the policy types previously discussed. Though it is more expensive, many workers (especially those who went through general training and then became highly specialised) choose ‘own occupation’ coverage to prevent being denied benefits in the event of a disability.
As the level of disablement outlined by Superannuation Law is based on ‘Any Occupation’ guidelines, however, more often than not, this will be the level offered when your TPD is drawn from your Superannuation account.
Once you have sufficiently proven your permanent disability and have gone through the waiting period outlined by your TPD insurance provider, you will receive a single lump sum benefit payment. This payment not only covers your loss of income, but it can also be used to finance ongoing medical expenses, future expenses like rent, and ongoing personal expenses and debts. As a result, an estimation of all these should be worked out and presented to your superannuation provider when requesting TPD.
Total and Temporary Disability
As the name suggests, this type of coverage is meant to assist individuals who are unable to work for a limited period of time due to an injury, illness or other types of disability. Unlike TPD, TTD payouts are continuing – usually monthly. TTD can often be received in addition to any other insurance coverage such as WorkCover.
Similarly to TPD, the criteria required to receive benefits vary from provider to provider. However, likely due to the lesser amounts being dealt with, the minimum thresholds for qualification tend to be lower and less challenging to meet. While some policies require that you are completely unable to work, most can be enacted if you are simply unable to do your current job. Certain policies even provide assistance if you are only able to work at certain aspects of your job and receive reduced pay as a result.
How Much Will TTD Pay Out?
Most often, Total and Temporary Disability provides a percentage of your usual wage or salary. A common figure is 75% - however, this depends on your particular policy. Some policies offer payouts in the form of the lesser of either 100% of your wages or a pre-defined number. It’s important to be wary of these details – 100% may sound appealing, but if you make considerably more than their predefined amount, you will find yourself with a severely decreased income.
How Long Do TTD Payments Last?
The maximum length of time one can receive a single run of TTD payouts is usually two years. However, a number of factors can cause your benefits to be cancelled. These include:
• No longer meeting the criteria required to be considered totally and temporarily disabled
• You are granted total and permanent disability (TPD) benefits
• You work status changes to one not allowed, be it with your previous occupation or another one
• You reach a certain age (most often 65)
There is also a waiting period before you are able to receive TTD benefits. This tends to be considerably shorter than the TPD waiting period – between a month and 90 days.
We Facilitate Your Superannuation Claim
At Zaparas Law, we are highly experienced in helping permanently and temporarily disabled individuals claim their superannuation benefits. We can read through the fine print of your policy, advising on which benefits you will qualify for and how much you may be able to claim. Our goal is always to get you the maximum amount possible, ensuring you do not experience a decreased quality of life or any financial troubles while injured. Contact us today to book your no-obligation consultation.
