How to Claim Total and Permanent Disability

“The best way to predict the future is to create it.”

Abraham Lincoln

How to Claim TPD Insurance Without Legal Costs

If you have been unable to work for a minimum of 6 months and it seems you will not return to work then you can claim your Total and Permanent Disability (TPD) Insurance. This also means you may potentially be eligible to access the early release of your superannuation. Read on to discover how I did both without paying for a solicitor. Discover the tips and tricks I uncovered along the way. I saved myself $10,000 in quoted legal fees and $50,000 in tax plus I saved a heap of time following these steps.

If you are reading this outside of Australia you will learn basic tips on how you can work within your own country’s system. As I like to  say, all skills are transferable. 

Disclaimer: 

Firstly, I am not a solicitor or financial advisor. Therefore, I sought advice from both professions initially then applied what I had heard and researched. After lodging my application , I successfully claimed TPD and the early release of superannuation without paying a cent. I suggest you do your own research and make decisions that are right for you and your circumstances. If you’re struggling physically or emotionally, ask a trusted friend or family member for help with the claims process. Nevertheless, this post unpacks the steps I took and is a guide for others to do the same. 

“It is not in the stars to hold our destiny but in ourselves.” 

William Shakespeare

Can you work after a heart or lung transplant?

Are you being assessed for a transplant? Perhaps you on the active waiting list for a transplant? Otherwise recovering from a transplant or facing rejection after a transplant? You could be eligible to claim TPD insurance if you have it and access your superannuation early.

Many organ transplant recipients return to work. Statistically kidney, corneal and liver transplant recipients are more likely to return to work 3 to 6 months after a transplant. When it is a heart or lung transplant it becomes more dependent on your illness before the transplant, success of the surgery, adjustments to medications, rejection and complications after a transplant. It also depends on the type of work you were doing before illness and transplant.  

When a Heart or Lung Transplant Impacts Work   

Many heart or lung transplant patients are not able to return to work. Some patients may change from full time to part time work. Some people decide to retire early if they can. Other patients may retrain or change careers to align with their physical capacity. Many have to take leave and hope they can return to work. 

In my case I have not been able to work since December 2021. Throughout 2022 and 2023 I was undergoing medical and surgical treatment for a mould infection in my lungs. During this time I also had bilateral breast cancer surgery and radiation therapy. Only then was I finally eligible for the transplant active list in May 2023. 

During this time I used my work leave entitlements (sick and long service leave) at half pay for three years. Yes I had saved up a lot of leave after teaching for 32 years. In hindsight this was such a blessing. This leave kept us afloat until it ended and we started to sink. I knew it was time to apply for my TPD Insurance cover and the early release of my superannuation. 

First things first … 

What is TPD Insurance?

TPD insurance provides a lump sum payment if you’re unable to return to work due to illness or injury. This type of insurance is often bundled with superannuation accounts, meaning you may already have coverage without knowing it.

To be eligible for TPD, you must prove that you are permanently unable to work in your occupation or any other job you are reasonably qualified for, due to a serious health condition.

What is Early Access to Superannuation?

Early access to your superannuation is typically allowed only under specific circumstances, such as: Financial Hardship, Permanently leaving Australia, and compassionate grounds. 

For example for financial hardship you can apply for one payment of up to $10,000 gross in a 12-month period as long as you haven’t received a financial hardship payment from any superannuation fund within the last 12 months. To find out more visit Access your super early  

Terminal Illness Or Permanent Incapacity

If you qualify for a TPD claim, you are most likely able to access your superannuation balance early due to permanent disability. Be aware that if you access your Super early before your preservation age (e.g. 60 years) you will be taxed at either 17% or 22%. I will explain how to get the lesser tax rate soon. If you live in Australia click the link to find out your preservation age.

How to Claim TPD Insurance Without a Solicitor

There are a few moving parts to making a TPD claim. I will break it up into steps and tips. Perhaps you might like to read the whole post first. Then work through the steps as you actually go through the process of making a claim. 

Who to Contact to Make a TPD Claim

Initially you need to contact the person or company you bought the TPD policy from.  If you bought insurance through: 

An insurer, contact the insurance company 

An insurance broker or financial adviser  then speak to them first

A superannuation fund, just contact your fund

An employment arrangement means you need to speak to your employer

Tip: Make sure you have your policy or member number available.

Tip: Plan what you will say to give a quick snapshot of what your medical situation is. The contact person does not need to hear all your medical history. Keep it as brief as possible. Do not offer too much information at this first contact. 

Check Your Policy Details

The next step is to check your superannuation fund for TPD coverage. You can do this by logging into your Super Fund’s online portal. Otherwise, as suggested above contact them directly to request a copy of your insurance policy. Ensure that the policy covers you for your specific circumstances.

Tip: Once you know you have TPD cover you can ask the fund how the claims process works. Ask them what forms you need to fill out. Request that the whole claims application bundle be mailed to you via post in hard copy. Also ask for a digital copy to be emailed to you. It is easier if you have both a hard and digital copy. The hard copy keeps you on track and helps you follow each step. The digital copy is vital. I will explain soon.

Tip: Remember that when you first make contact, state the date you were first injured or became ill. The TPD claim is backdated to the beginning of your health issue or to the diagnosis. This may mean thousands of extra dollars in your pocket. For me this was a difference of $25,000. With my policy the sum insured decreased each year. Therefore, I backdated the incapacity to the beginning of my illness in 2020. This resulted in a higher sum insured than when I lodged the claim in 2024.

Gather Medical Evidence

Your claim will require substantial medical evidence to prove that you are permanently disabled and unable to work. You should obtain medical reports from your treating doctors that outline your condition, treatment history, and prognosis. Be aware that Psychologists are not valid or applicable to this process.

The medical evidence I used included hospital discharge papers, medical imaging reports and pathology. I also included specialist referral letters and reports, surgical procedure reports and medical clinic notes. 

Tip: Contact your hospital’s Patient Information Department and request all your medical records be emailed to you. This should be free as they are your records.

Tip: I do this as a patient of ST Vincent’s by walking into the department on level 2. You do need to show your drivers licence and provide an email address. 

Tip: I update these files every 3 months. I download them to my computer and store them into folders (pathology, imaging, discharge papers, medical notes). 

Tip: Start collecting medical evidence now if you have not been doing this already. It makes the claim process more manageable and time effective.

Tip: You will need medical report forms completed by multiple doctors using the forms included in the claims pack. They only supply one form so you need to print, copy and email multiple copies (total of three).

Complete the TPD Claim Form

Most Super Funds have a specific TPD claim form they want you to use. This is the bundle I talked about – get a hard copy and a digital copy. Forms may also be available for download on the insurers websites.

Generally the forms will include:

Member’s Statement

This is completed by you. It includes:

• Your details.
• A statement about the nature of your illness or injury.
• Details of all doctors/specialists or health professionals including email addresses.
• Your employment details.
• Functional physical and psychological limitations.
• Proof of identity, tax file number (if not already supplied to your superannuation fund).
• Your previous work history and education. I found it easier to attach a copy of my CV. I Google a statement of duties and attached that too.
• Return to work statement.
• Details of your Emergency contact person.
• Medical consent Authority to release health information.
• Information authority and Declaration and signature.
• Medical evidence as outlined above.

Employer’s Statement

You can ask your senior line manager to complete this form. You do not need to go to HR or head office necessarily. For example I asked my Principal to complete this section which includes:

• Employer details. If they are the boss I am sure they can do this by themselves.
• Employee details (i.e. your details) I provided a word doc with all this information to save my Boss time and ensured accuracy.
• Employment details. I sourced and supplied my payslips and statements of leave entitlements. This saved my Boss time and allowed me to control the information being supplied.
• Declaration and sign

Attending Doctor’s Statements

These are the two medical reports completed by a GP and specialist and include:

• Patient’s details
• Patient’s medical and consultation details
• Treatment and progress of medical condition(s)
• Patient’s capacity for work
• Functional physical and psychological limitations
• Declaration and sign
  

Attending Doctor’s Statement No 1

I asked my family GP to complete this form. They were also provided copies of medical reports.

Attending Doctor’s Statement No 2

OK this is exactly the same form as the one above. Print or email a copy to your specialist. This second report must be completed by a specialist or consultant. Not another GP. A psychologist report is not acceptable either. A Professor from the heart lung clinic completed this form for me.

Tip: The Professor sent it directly via mail to the Super Fund. At the end of the process I requested and received a copy of this document for my records.

Confidential Medical Report On Permanent Incapacity

Use this form if you are also applying for early release of your superannuation on the basis of permanent incapacity.

Tip: If you are claiming TPD Insurance you only need one doctor complete this form. This is because the Australian Taxation Office (ATO) uses one of the Attending Doctor’s Statements as evidence.

Tip: If you are only applying for the early release of superannuation you need to have two doctors complete this form. That means you did not apply for TPD insurance and have not had two doctors complete the Attending Doctor’s Statement.

Tip: This form is not included in the TPD claim bundle. You need to ask for a hard and digital copy to be included. This is an ATO requirement and is in the small print as it saves you 5% tax. Keep reading it will make sense eventually.

Tip: This can be another specialist but it can also be another GP. Being a transplant patient you will most likely have many consultants to choose from. Get a third different doctor to complete this form. Do not send it off with your TPD application. Hold on to it. I will explain soon.

How To Ask For Medical And Employer Reports

You are asking people who do not really know or love you to do something for you. Make it easy for them to help you out. It’s important to save them time and effort. Help them to help you. You might ask in person, over the phone or via email. I found it was easier to ask them in person. Then I emailed them the relevant forms and a cheat sheet.

Create A TPD Cheat Sheet

Tip: Create a cheat sheet for your Employer and Doctors to refer to while they fill in these forms. Firstly create a Word doc or similar. Put your personal details and Super Fund / TPD member details as a header on each page. Answer each question in order using the same headings on the forms. I followed the questions in order as they are listed in each report (e.g. Step 1. Question 1). This saves your employer and doctors so much time. Even looking up your date of birth and home address takes time. 

Tip: I created the word documents so that doctors could actually attach the responses to the medical report. To Be Clear, they will have to write on the actual medical report copy. It is important that they complete the form in their writing. However, there are sections needing long lists of treating specialists contact details and emails, medications, treatments and surgeries. The Word doc can be attached rather than doctors needing to write all these details in. 

Tip: I found I answered one report then copied sections into three more cheat sheets (Employer and three Doctors reports). Structure the pages so they can be attached separately to individual sections of the report. Not all pages needed to be attached. Some pages will just help the doctors or employer to answer questions. These pages can then discarded. While long lists of medications, surgeries, treatments can be attached and sent in with the claim paperwork. Think about how you can do this. Each Cheat Sheet should look original and different from the others.

Submit the TPD Claim

Submit the completed TPD claim forms and medical evidence to your superannuation fund. Most funds will allow you to submit your claim online, by post, or via email. After submission, the fund may assign a case manager who will review your application.

Tip: Keep a hard copy or digital copy of everything you send in. During my claim form I received multiple emails stating I had not provided certain documentation. I confidently replied that I had a copy. Then I respectfully requested they check their records before I mailed a second copy. The missing documents always appeared and the claim process continued without unnecessary delay. Remember, the Insurers are going to be paying out a lot of money. It could be seen that it is in their interest to make the process tedious and slow.

How Long Does A TPD Claim Take?

After submitting your claim, be prepared to wait several weeks to months for a decision. In some cases, your insurer or Super Fund may ask for additional evidence or clarification. It’s important to follow up regularly and promptly provide any extra information to avoid delay.

My claim was lodged in April and accepted by June. I was surprised how quickly it was accepted. 

The longest part of the process was waiting for Attending Doctor’s Statement from doctors who are so time poor. By getting the ATO’s Confidential Medical Report On Permanent Incapacity at the start of the process saves time when applying for the early release of your Super. It also reduces the tax you pay by 5%.

It’s also important to make it easy and quick for employers and doctors to write the report by providing the cheat sheet.

How Do You Know When Your TPD Claim Has Been Accepted?

You will be notified in writing by mail and also by email. However, I first knew that my claim was successful when I was checking my activity and transaction history in my Super Fund app online. I noticed a payment amount added to the account labelled TPD payment. Happy Days!

What Happens If My TPD Claim Is Denied?

If your claim is denied, you can appeal the decision directly with your fund without a solicitor. You may need to provide further medical evidence or clarification.

Accessing Your TPD and Super Money

You will be notified by your Super Fund once the TPD claim is accepted. The TPD insurance money will be deposited into your Super Fund. Your Super fund moves from a Preserved status to Non-Preserved (accessible) status. 

The Super fund will send you paperwork for you to complete. You need to choose what you want to do with the balance of your Super funds/money. 

There are three options: 

1. leave the balance of money in the Super fund until you reach preservation age (No tax penalty). Within this option you can also move the balance to another Super Fund (or Self Super fund scheme).

2. Withdraw all of the balance out and deposit it into your own bank. This means your super account will be closed. If you are not yet of preservation age (for example 60) you will pay tax. 

3. Withdraw part of the funds leaving a minimum amount in the fund to keep it open. As in choice 2 you will pay tax on any money you withdraw if you are not of preservation age. You can always access any remaining money at any time as it is in a non preserved account. You will pay tax on any withdrawals until you reach preservation age. 

If you choose option 2 or 3 to move your money into a bank account and you are not of preservation age, you will pay tax. This is when you will need to have the third medical report. This is the Confidential Medical Report On Permanent Incapacity I talked about before. It will save you 5% tax off the balance of your Super.

How Do You Reduce Tax On Superannuation Payout?

The third medical report (Confidential Medical Report On Permanent Incapacity) is essential if you want to get your Super taxed at 17% rather than 22%. Getting this third medical report saved me over $50,000 in tax just by reducing the tax rate by 5%. Hence, get the third report when you get the other doctors reports rather than waiting months for the claim to be lodged and assessed. 

Hold onto it until your TPD claim is accepted. When you complete the form to access your money and choose option 1, 2 or 3 you can then supply the third medical report (Confidential Medical Report On Permanent Incapacity) to the Super Fund. This third certificate will be sent to the ATO on your behalf. 

You will hear back from the Super fund via letter or email notifying you of the payment. They will provide a financial tax statement and the money will appear in your elected financial account. You should find that with the third medical certificate the tax rate applied was 17% rather than 22%.    

TIP: Did you know that once your TPD insurance claim is accepted the sum insured is paid into your Super fund. It is not paid directly to your bank account. You can not access TPD monies unless you apply and are granted the early release of your Super.  

However, This is the biggest tip I have. Complete this third medical report at the same time you request all the other forms to be completed. If you want the Tax Penalty reduced from 22% to 17% when you access your TPD or Super payment you need the Confidential Medical Report On Permanent Incapacity to be completed by a third doctor. 

Common Mistakes to Avoid When Claiming TPD and Early Superannuation Access

Not reviewing your policy: Ensure you thoroughly understand your policy terms and conditions before submitting a claim.

Incomplete medical evidence: Providing detailed and comprehensive medical evidence is critical for a successful claim.

Missing deadlines: Some superannuation funds have time limits for lodging claims, so ensure you submit within the required time frame.

What If You Do Not Have TPD Insurance?

If you do not have TPD insurance you can still access your Super early. The process is basically the same. However, a different claim form bundle will be sent to you. I give a brief outline below. You can see the steps are the same so I have not elaborated or repeated tips.

HOWEVER, to reduce your tax rate you will need to have two different doctors complete the Confidential Medical Report On Permanent Incapacity statement. This way the tax penalty will be reduced from 22% to 17% when you access your Super payment. 

Steps to Access Your Superannuation Early due to Illness or Injury

Check Eligibility

To access your Super early due to illness or injury, you’ll need to meet the Australian Taxation Office (ATO) eligibility criteria. These include having a terminal medical condition, permanent disability, or severe financial hardship due to illness or injury.

Provide Medical Certificates

Two medical practitioners will need to certify that you have a serious medical condition. This medical condition will likely result in your death within 24 months or that you are permanently incapacitated. One of these certificates must come from a specialist in the relevant field. 

As you have read the post you are aware that you need a third medical report to save 5% tax. I can imagine so many people are so tired, sick and desperate at this stage of the process. So over it in fact that they can not be bothered with the third medical report. How many people, I wonder get slugged by the 22% tax rate? 

Apply Through Your Super Fund

Once you have gathered your medical evidence, apply to your Super fund for early access. Each fund has its process, so be sure to check their requirements and submit all necessary documents.

Follow-Up on Your Application

Just like with TPD claims, it’s crucial to follow up regularly on your superannuation early access request. If additional information is required, respond promptly to avoid delays.

Total Savings

I saved 10,000 dollars in solicitors fees that I was quoted. I saved 50,000 dollars in reduced tax by supplying the ATO’s Confidential Medical Report On Permanent Incapacity statement. Total $60,000. Including the additional $25,000 in TPD cover, I came out $85,000 better off than before I learned all these tips.

I saved time by collecting all the paperwork at once rather than waiting for the claim to be accepted.

My employer and doctors used the Cheat Sheet to complete the statements more quickly and easily. 

I am happy, if this post helps just one other person save time and money during tough times. If that’s you please let me know. It would bring me joy.

Other posts you may find helpful: End Of Life Planning or Surgical Support, Waiting For A Heart Transplant or even Getting the Call.

If you have been through this process or claimed income protection please your tips in the form below.

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Wednesday

References

Australian Government. (2023). Early release of superannuation benefits. Australian Taxation Office. https://www.ato.gov.au/Individuals/Super/In-detail/Withdrawing-and-using-your-super/Early-release-of-super/

Australian Securities and Investments Commission (ASIC). (2023). Insurance in super. MoneySmart. https://moneysmart.gov.au/how-life-insurance-works/insurance-in-super

Preservation rules. (n.d.-a). State Super. Retrieved September 25, 2024.

https://www.statesuper.nsw.gov.au/pss/benefits/preservation-rules

Superannuation Complaints Tribunal. (2020). Making a complaint. Australian Financial Complaints Authority. https://www.afca.org.au/make-a-complaint/superannuation