A rejection letter is not the end of the road if you’ve had your Total and Permanent Disability (TPD) claim rejected. It might feel like a dead end, but there is a clear pathway to appeal to protect consumers and hold insurance companies accountable.

Whether you are dealing with a life-changing injury or illness, the inability to work while dealing with medical bills can be overwhelming. A TPD payout is a financial lifeline designed to provide a financial cushion while you are going through immense emotional, physical, and economic distress. So, a rejection can be disheartening, but the assessor’s initial decision is not the final one. 

TPD claim rejected? The first step in securing the financial support you deserve is understanding the available options.

Most Common Reasons for TPD Claim Rejection

Insurance assessors scrutinise every detail in a TPD application to test whether it fits the policy’s strict boundaries. As a result, there are several recurring justifications we see in rejected TPD claims. 

  • The most frequent cause for denial is failing to meet the policy’s strict definition. For example, certain policies differentiate between one’s own and any occupation. If you are capable of some work, they may reject the claim.
  • Insufficient (or inconsistent) medical evidence. Whether it’s vague statements, inconsistent medical notes, or the insurer’s independent medical expert disagreeing with your doctors or specialists, insurers will typically side with their expert.
  • Timing is often a cause for rejection. Insurance assessors will check when you stopped working and attempt to argue that coverage lapsed before this point or that it was related to a pre-existing condition.
  • Technical hiccups or procedural issues also lead to rejection, whether it’s missing a deadline, insufficient records, or incomplete forms; these can lead to automatic rejection.

Step 1: Request an Internal Review

The first step after a rejection is triggering your insurer’s internal dispute resolution process. The law requires all insurance companies and superannuation funds to maintain an internal department solely charged with reviewing disputed decisions.

Request a full explanation in writing for the rejection before you trigger the dispute process, and ensure it contains all the necessary information they used to come to their decision. Once this is in your possession, you can address each objection directly. This is also your opportunity to submit additional statements from specialists clarifying their findings, updated medical evidence, or anything else that may counter the assessment.

Step 2: Complain to the Australian Financial Complaints Authority (AFCA)

AFCA, an external dispute resolution service, provides free reviews of insurer decisions (if the insurer didn’t respond within the timeline or the internal review didn’t overturn the decision). This independent body is the referee between financial institutions and consumers. An independent panel will review your case file from beginning to end, reviewing the insurance policy’s strict legal wording while weighing whether the insurer’s actions were fair and reasonable.

While it’s a free service anyone can access, it’s worth noting that their decisions are legally binding.

Step 3: Possible Legal Action 

Legal action is the final option. If you aren’t satisfied with AFCA’s response, there are conflicting medical opinions, or complex questions, formal litigation may be the most appropriate action. While the thought of taking an insurance company to court may feel intimidating and stressful, a specialised lawyer will handle the heavy lifting. Your lawyer can gather additional evidence, enlist ergonomic experts, labour market specialists, and occupational physicians, and collate occupational evidence to support your case. 

Court action can be the motivation insurers need to take settlement negotiations seriously. 

What You Can Do Now 

If you have recently received a rejection notice, a methodical approach will preserve the right to appeal and keep you in the driver’s seat over your claim.

  • Request the insurer’s reasons for rejection in writing. You need to see the reasons in writing, along with the evidence they used to reach their conclusion.
  • Schedule appointments with your medical team to gather updated medical evidence. Ask your specialists to counter any gaps the insurer highlighted in their rejection explanation. 
  • Records are key to proving your case. Save every letter you receive, and file medical receipts, emails, appointment letters, and test results. Keep a record of every phone call you make or receive, including the date, time, who you spoke to, and a general idea of the conversation that took place.
  • Secure legal advice as early as possible, particularly before accepting a rejection as the final word. Never sign documents from an insurer until you have spoken to an experienced lawyer.

Acting promptly will protect your rights, and there are strict time limits that apply to both internal insurance reviews and AFCA complaints. If you miss one, you could lose your right to challenge unfair decisions.

FAQs

What can I do if my TPD claim is rejected?
  • Contact your insurer to request a formal internal review. 
  • Lodge a complaint with AFCA. 
  • Consult a lawyer and pursue civil litigation.
Does lodging a complaint with AFCA cost money?

No, lodging a complaint with AFCA doesn’t cost money; it’s a completely free service.

How long do I have to challenge a TPD rejection?

That depends on your policy and whether you have TPD cover in your superannuation. The limit to file an AFCA complaint or take court action can run anywhere from two to six years, either from the date of disability or from the initial rejection.

How AJB Stevens Can Help 

When you’re dealing with a serious health condition, you don’t need to battle the overwhelming stress of navigating insurers, super funds, and legal guidelines. At AJB Stevens, our experienced compensation team will provide clear and compassionate guidance, guiding you through every step of your rejected TPD claim. We can also explain how your TPD options can work concurrently with a workers’ compensation claim. 

We take an evidence-backed approach to building claims and fighting appeals. We’ll gather the evidence and ensure your voice is heard. Arrange a free consultation today and we will review your TPD claim rejection letter and explain your options.