Superannuation disability claims
Obtaining new insurance or superannuation policies
Superannuation/insurance and your social security payments
Superannuation/insurance and returning to work
Superannuation and Insurance Advice Service
This section gives you general information about superannuation and insurance policies, superannuation contributions, how you can make claims - particularly for disability benefits - the effect on your Social Security payments and what happens if you return to work. It also includes details of your rights of appeal and the Superannuation and Insurance Advice Service.
Many people living with cancer may be able to claim a lump sum or pension if they have a superannuation policy.
Superannuation has been compulsory since 1992.
Superannuation funds often provide for a lump sum to be paid to you if you cannot keep working because of your illness. This lump sum benefit is often provided as an 'extra' on top of your superannuation contribution. Some funds provide a further benefit of a disability pension paid for two years or more.
Many people do not know that they can claim disability benefits from their superannuation fund or when they can get a payout of their contributions. Superannuation funds send out statements every year but they can be hard to understand.
If you are not sure whether you are entitled to any disability benefits, or if you cannot find any of your statements, you should ask your employer, your superannuation fund or someone who has expertise in this area.
Under the superannuation laws, your employer must pay your superannuation contributions into a fund at least once every three months. However, many employers have agreements with superannuation funds to pay contributions more often, for example, monthly or fortnightly. Some industrial awards also state that employers must pay superannuation contributions more often. To find out, contact:
If your employer does not pay superannuation contributions into a fund for you, you should inform the Australian Taxation Office (ATO). If the contributions are not being paid, get help immediately from the ATO, a lawyer who specialises in this area, the Superannuation and Insurance Advice Service or your union.
Your own contributions can be paid to you when you leave a superannuation fund, though the general rule is that contributions by your employers must stay in a fund until you are fifty-five or sixty years old.
However, there are exceptions to this rule, and you can get hold of your employer's contributions if any of the following applies:
(a) you have been on social security payments for at least 6 months (or 9 months, if you're over 55 years and 9 months of age) and can't pay your living expenses
(b) your house is about to be sold by a bank or other mortgagee
(c) you need money for palliative care, death expenses, changes to your house or car, or medical expenses outside the public health system for you or a dependant
(d) you are totally and permanently incapacitated
(e) you have a superannuation account balance of less than $200
(f) you are a temporary resident, and permanently leave Australia.
Many people living with cancer are able to claim disability benefits.
To get a disability lump sum, you usually have to show you can't ever go back to your previous job or any other suitable work that fits your education, training or experience.
For example, if you have worked all your life as a labourer or process worker, you will have to show that you cannot do manual work again.
It doesn't matter how a disability or illness came about. All disabilities and illnesses are acceptable for a superannuation disability claim.
Many people on social security benefits will be able to claim.
You can usually make a claim any time.
It doesn't matter if you have already had your superannuation contributions paid out to you, even if that happened a long time ago. Disability claims can also be made by the estate of a person after they die. There will be claim forms to fill in and medical reports and other papers to send in. It is important to give the right information and reports to help a disability claim. It may take many months before a decision is made, and you may be asked to go to some medical examinations.
If a claim is rejected, you can appeal to a court or the Superannuation Complaints Tribunal.
It is often worth appealing as many appeals settle before they reach court or are successful when they are heard in court. It is important to get help from a lawyer experienced in insurance claims or appeals.
Superannuation funds pay death benefits to the dependants or the estate of a deceased person. In most cases, the superannuation fund trustee is not bound to give benefits to your nominated beneficiaries. A decision of the superannuation trustee can be appealed. Contact the Superannuation and Advice Service for assistance.
Some people living with cancer may be able to claim disability benefits from other insurance or superannuation policies that they hold.
Some people have their own superannuation or life insurance policies which may include disability lump sums or 'premium waiver benefits'.
Premium waiver benefits are when the insurance company pays your premiums for you when you can't because you are ill and/or not working. Most self-employed people have income protection insurance to cover them if they can't work.
Banks and finance companies sometimes ask their customers to take out insurance to cover mortgage or loan repayments if they can't keep up the payments because of disability. You will need to check with your bank or your personal records to find out if you are covered.
Some credit cards include disability lump sums as a benefit. You will need to check with your credit card provider to find out if your credit card has such a policy. Some banks, employers, unions, credit unions and sporting and social clubs have disability insurance policies for their members. You should check your records with each organisation or with the Superannuation and Insurance Advice Service.
Insurance disability claims can usually be made at any time although it is better to make a claim as soon as possible.
There will be insurance claim forms to fill in and medical reports and other papers to send to the insurance company. It is important to provide the right information and reports to help your claim. It may take many months before a decision is made, and you may be asked to have some medical examinations.
If the insurance company rejects your claim, you can appeal their decision to a court or to a low-cost insurance complaint scheme. You can get help from the Superannuation and Advice Service, phone (03) 9805 9126.
If you already have cancer, it may be difficult to take out a new policy with disability or death benefits.
If you try to take out your own insurance or superannuation policy, you will usually have to fill in a medical questionnaire for the insurer to calculate your health risks and decide whether they wish to cover you.
If you know you have cancer, the usual practice is that you have to tell the insurer. They may then refuse to cover you for disability payments. If you know that you have cancer when you join but do not tell the insurer, then they may refuse to fulfil their obligations and will not pay disability payments to you. However, this is not always the case. If you have had cover for more than three years, an insurance company may only refuse to pay you or reduce your payments if:
However, it may be possible to get disability and death cover by joining a 'group' superannuation or insurance scheme, for example, with your employer or your union or credit union. In such schemes, you may be offered automatic cover without any health tests or questions.
A superannuation lump sum will usually be taken into account in an assets test to work out the amount of your social security payments. However, if you keep the money in a superannuation fund, it will not count as an asset until retirement age.
Superannuation pensions are treated as income, and may reduce your social security payments.
An insurance lump sum payout will be taken into account in the assets test to work out the amount of your social security payments.
Insurance income replacement payments are usually treated as income, and may reduce your social security payments.
If you have stopped work because of cancer, you can return to work if your health improves and you feel that you are able to go back to work. If you do go back to work and you have already been paid a superannuation or insurance disability lump sum, you will not have to repay the lump sum. If you are receiving a superannuation or insurance pension, you have to tell the fund or insurer that you are returning to work. If you do not tell them, you may be liable to repay any payments you received. If you return to work and you are earning more than $450 per month, your employer will once again have to pay your superannuation contributions. Your new superannuation fund may also include death and disability benefits even though you have cancer.
Many people do not know that they can claim disability benefits from their superannuation or insurance. If your working life is cut short, you probably won't have enough superannuation. Extra disability benefits will help you. This is because your superannuation is designed to last for an 'average' period of retirement, not longer.
The Superannuation and Insurance Advice Service is a free service. It has been set up to provide legal advice to people with disabilities. The advice is given by volunteer lawyers. The service is based in Melbourne and is open between 6 pm and 8 pm every Thursday night at the MS Society, corner Gordon and Barkly Streets, Footscray.
Appointments can be made by calling the Chronic Illness Alliance on (03) 9805 9126.
You can get free advice by telephone or by appointment.
You may wish to ask lawyers who have expertise in superannuation and insurance for advice or see a financial counsellor.
To find a lawyer who specialises in this area you can call the Law Institute of Victoria Referral Service on (03) 9607 9550.
The information contained in this chapter is necessarily brief, and may not be relevant to every claim. Superannuation is a complex area of law. It is important that you get specialist advice.
Updated June 2004
