For many Australians who suffer serious injuries or illnesses, a Total and Permanent Disability (TPD) claim can be a vital lifeline. It’s a way to access financial support when you’re no longer able to work. But unfortunately, not all claims are successful the first time around. In fact, a 2023 report by the Australian Prudential Regulation Authority (APRA) revealed that nearly one in four (23%) individual non-advised TPD claims are initially declined. Some are denied due to lack of cover.
Still, a rejection isn’t necessarily the end of the road. There are clear steps you can take to challenge the decision and improve your chances of receiving the support you need.
What Is TPD Insurance, and Why Does It Matter?
TPD insurance provides a lump sum payout if you’re unable to work again due to a significant injury or illness. Often, this insurance is included automatically in your superannuation, though many people aren’t even aware they have it. If your claim is approved, it can help cover ongoing medical costs, daily living expenses, and other long-term needs.
Because the payout can make such a big difference, a rejection can feel overwhelming. But many people do successfully appeal these decisions and ultimately receive compensation.
Why Are TPD Claims Sometimes Rejected?
There are a few key reasons why a TPD claim might be denied:
Inactive or Cancelled Policies
Sometimes, your insurance cover may lapse without you knowing, especially if you’ve changed jobs or stopped contributing to your superannuation for a while.
Policy Definition Not Met
The definition of “total and permanent disability” isn’t the same for every policy. If your situation doesn’t match the insurer’s specific wording, your claim could be rejected—even if your condition is serious.
Lack of Sufficient Medical Evidence
Your claim needs to be backed by solid documentation. Without detailed medical records, specialist reports, and proof that your condition affects your work ability, the insurer may say there’s not enough to approve the claim.
Work History Issues
Some policies require you to have been working a certain number of hours or years. If this isn’t clearly shown in your documentation, it could become a problem.
What You Can Do After a Rejection
If your claim has been knocked back, don’t panic. Here’s what you can do next:
Read the Rejection Letter Carefully
Look closely at the reasons they’ve given. This can help you understand what’s missing or what you may need to clarify. You can also request a copy of the full claim file from the insurer.
Collect More Supporting Documents
Strengthen your case by gathering recent medical reports, statements from your doctors or specialists, employer references, and records of any rehab you’ve done.
Challenge the Decision
Internal Review
Submit your additional evidence to the insurer and ask for a review. Many claims are approved during this stage once more information is available.
Lodge a Complaint with AFCA
If the internal review doesn’t work out, you can take your case to the Australian Financial Complaints Authority (AFCA). They’re an independent body that resolves disputes for free. You need to make the complaint within two years of the insurer’s decision.
Consider Legal Action
If all else fails, you can go to court. You’ll need to start legal proceedings within six years of the claim being denied.
Be Aware of Time Limits
Deadlines matter in these situations. Here are the main ones:
2 years to lodge a complaint with AFCA
6 years to take legal action in court
Waiting too long can weaken your case, especially if medical records become outdated or hard to access.
Getting a TPD claim rejection can be disheartening, especially when you’re already dealing with serious health and financial challenges. But it’s not the end of the road. With the right approach—and by taking prompt, well-informed action—you may still be able to secure the support you’re entitled to. Knowing your rights and following the proper steps can make a real difference in the outcome.
Read this next: Building a Strong Case: The Tradesman’s Guide to Compensation Claims
