The Financial Services Council (FSC) yesterday announced an initiative on behalf of participating life insurance member companies to ensure that if people lose their job, are stood down or have reduced working hours due to COVID-19, this will not affect their total and permanent disability (TPD) cover.
The initiative runs to 27 September 2020 and claims must be lodged before 1 January 2021.
FSC CEO Sally Loane said this initiative aims to ease any concerns people may have with their TPD cover by preventing any changes to cover being automatically triggered because of COVID-19.
She said, “Today’s announcement ensures that if you make a TPD claim resulting from an illness or injury occurring since the pandemic has started, participating life insurers will assess your claim based on your working arrangements as at 11 March 2020—the date when COVID-19 was declared a pandemic—meaning you keep the cover you had based on your working arrangements before the COVID pandemic declaration. 11 June 2020 is three months after WHO declared the coronavirus to be a global pandemic on 11 March 2020.”
“This announcement has been timed to ensure the initiative is up and running before anyone is adversely affected,” Ms Loane said.
As at the end of 2018, there were over 7.5m Australians with TPD through their group superannuation policy and over 25,000 TPD claims were lodged in 2019.
The FSC is a peak body which sets mandatory standards and develops policy for more than 100 member companies in one of Australia’s largest industry sectors, financial services. Full Members represent Australia’s retail and wholesale funds management businesses, superannuation funds, life insurers and financial advisory networks. Supporting Members represent the professional services firms such as ICT, consulting, accounting, legal, recruitment, actuarial and research houses.