Injured and ill face delays of up to 18 months, as super funds continue to breach industry codes

Father of three Joshua Roberts is facing losing his home as the family continues to spiral into debt while waiting on super fund AMP to make a decision on his Total Permanent Disability (TPD) claim, after paying years’ worth of super insurance fees.

The NSW former truck driver can no longer work and has been waiting 12 months for the fund’s insurer Resolution Life to accept or reject his claim for a lump sum payout, after suffering a violent epileptic seizure on 22 August 2021 causing him to lose his truck driving license.

“We are facing collection from the bank on our mortgage. I’m the sole income earner and we have built our lives around this. We got our own home and thought we’d be covered in case of a health issue like this after paying super insurance premiums since 2012,” Mr Roberts said.

“My premiums went up when I moved into truck driving with it being a more dangerous profession. Once I got the epilepsy diagnosis and could no longer work after 20 years of driving, it seemed so straight forward and clear cut that we’d be covered at the beginning of the claims process. Now it’s been a year and we are trying to save our home. We are trying to save what we have built.”

Slater and Gordon Superannuation and Disability Practice Leader Annemarie Gambera said the firm was representing clients who had seen delays of up to 18 months, despite the industry’s Life Insurance Code of Practice stating decisions should be made within six months. She said she had been forced to lodge a complaint against Resolution Life with the Australian Financial Complaints Authority (AFCA) on a similar matter with an 18-month delay

“Even threatening to lodge complaints with the Australian Securities and Investments Commission (ASIC) which can attract fines has not improved their conduct. Delay tactics like this have not been this bad in years and we are seeing this type of behaviour from other funds too, including some of the country’s largest super fund insurers,” Ms Gambera said.

“We have had to write numerous letters to Resolution Life, with constant emails and phone calls left unanswered. Waiting it out until the injured or ill person gives up is not an efficient way to do things and it’s certainly not the right way to treat injured people who are entitled to make a claim after paying years’ worth of insurance premiums.”

Ms Gambera said the funds and insurers should face stronger financial penalties for delays in breach of the industry code.

“There needs to be real consequences for breaching the six-month timeframe. Delays this long should attract an immediate financial penalty,” she said.

The trustee of the fund has a specific obligation to comply with the Superannuation Industry (Supervision) Act to ‘do everything that is reasonable to pursue an insurance claim for the benefit of a beneficiary’. The trustee is obliged under the same legislation, to act in the best interests of its members. There is no evidence this is occurring, and we are seeing delays three times as long as what’s set out in the code.”

The lengthy delays have left Mr Roberts, who suffered a second seizure again recently which required even longer recovery time, feeling betrayed and belittled.

“It’s brought me down. You feel betrayed because you paid into it. And you are paying these fees while you are working, and you think you’re covered. I feel depressed. After the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, you think yes, the insurers must make decisions in a legitimate and fair fashion but we’ve been so shocked by these delays. It’s inhumane and unbelievable,” Mr Roberts said.

According to the industry code of practice, Mr Roberts’ claim should have been resolved in January 2023 at the very latest, after being lodged with the insurer with evidence from a specialist and GP in July 2022. Instead, it took the insurer months to respond stating they would need to request further information from doctors. Five weeks after complaints were made by Slater and Gordon in October, the insurer stated an employability assessment would need to be undertaken. It took the insurer until January to even request the report from the doctor.

Mr Roberts’ wife, Amber Wilson, said the family have had to rely on relatives to cover mortgage payments. She said the insurer had been claiming they were waiting on medical reports that were never requested by the fund or insurer, until they were pushed to by the law firm.

“On the 5th January this year, the insurer told us they would be requesting more information from the doctor in the form of a further report to determine whether Josh had capacity to undertake certain roles. I had a strange feeling and I thought I should ring the doctor, who confirmed they hadn’t received anything from the insurer for five or six months. Fourteen days later on the 19th, the insurer had still had not made the request. The request was finally made another four days later and the doctor was able to complete the report in February. All of these delays occurred knowing we are in severe financial hardship,” Ms Wilson said.

“We thought we must hold them to account and then you realise that they can get away with a lot. We thought six months would be it. But you have to fight all the way to prove you are unwell. You don’t have any idea until you’re in it. The insurer will do everything they can to avoid paying you. There is no part of it that has felt like they’re there for us. The stress of it has been almost unbearable.”