What To Do If Your TPD Claim Process is Rejected

Having a Total and Permanent Disability (TPD) claim rejected is a gut-punch at the worst possible time. You’re already dealing with an injury or illness that’s changed your life, and now the insurer has said no. It’s stressful, confusing, and, for many people, completely unexpected.

But a rejected TPD claim doesn’t have to be the end of the road. It’s becoming more common for insurers to initially decline claims and later accept them on review.You have rights, and there are clear steps you can take to challenge the decision.

Key Takeaways

• A rejected TPD claim is not necessarily final – you have the right to have the decision reviewed
• The most common reasons for rejection include insufficient medical evidence, not meeting the policy’s definition of TPD, or a lapsed policy
• There are three formal pathways to challenge a rejection: internal review, the Australian Financial Complaints Authority (AFCA), and court proceedings
• Time limits apply, so acting quickly protects your options
• A compensation lawyers in Cairns can help you understand your options and build the strongest possible case for review

Why Do TPD Claims Get Rejected?

Every policy is different, but the most common reasons for rejection include:

• Your claim didn’t include sufficient or consistent medical evidence
• You didn’t meet your policy’s definition of “total and permanent disability”
• Your policy had lapsed or was inactive at the time of your injury or illness
• The minimum waiting period under your policy hadn’t been satisfied
• Your work history didn’t meet the required criteria (for example, a minimum number of hours worked before the injury)
• You had a pre-existing condition that wasn’t disclosed when the policy was taken out
• Another claim (such as workers’ compensation or a motor vehicle accident claim) was considered to have already covered your loss

The Australian Prudential Regulation Authority (APRA) publishes life insurance claims and disputes statistics that track industry- and insurer-level outcomes.The most recent data, covering the period from 1 July 2024 to 30 June 2025, shows the industry average claims acceptance rate for advised TPD insurance was 82.5%, meaning almost one in six TPD claims are declined. If yours is one of them, here’s what to do.

What to Do After a Rejected TPD Claim

Step 1: Get the Rejection in Writing

Before anything else, make sure you have the insurer’s decision in writing with their reasons clearly stated. When an insurer notifies you that your claim has been denied, they are also required to provide you with information on how and where to request a review of the decision they have made.If the reason comes down to insufficient evidence, that’s actually a good sign – it means the door is open for a reassessment with better documentation.

It’s also worth getting a full copy of your policy document at this stage, not just the extracts the insurer quoted in their decision letter.

Step 2: Request an Internal Review

Your first formal step is to lodge a complaint with the insurer or super fund’s Internal Dispute Resolution (IDR) team. Many people are cynical about internal reviews, but they are a worthwhile step, particularly when you can provide additional supporting medical or other materials alongside the complaint.

Under current rules, if your complaint relates to a decision of a superannuation fund, they must respond within 45 days. If it relates to an insurer alone, they must respond within 30 days.

At this stage, a lawyer in Cairns can be invaluable. Strengthening your medical evidence – for example, by obtaining more detailed specialist reports or additional documentation – is often what turns a declined claim into an approved one.

Step 3: Escalate to AFCA

If the internal review doesn’t go your way, the next step is to lodge a complaint with the Australian Financial Complaints Authority (AFCA). AFCA is a non-government ombudsman service providing free, fair and independent help with financial disputes, covering things such as insurance, advice, investments and superannuation. Where an agreement cannot be reached between the parties, AFCA can issue binding decisions.

AFCA has different rules and time limits depending on whether your complaint relates to an insurance claim through a super fund or directly with an insurer. Due to the strict time limits, you should make your complaint as soon as possible after receiving the outcome of the internal review.

Step 4: Take It to Court

Court is the last resort, but it is an option. A lawyer can have your claim determined by a judge in court and, by doing so, potentially have the decision overturned, and your TPD benefit paid.Many cases settle before they ever reach a hearing, and legal representation at this stage is essential.

Don’t Ignore the Time Limits

This is critical. Each stage of the review process carries strict deadlines, and missing them can affect your ability to pursue further action. The time limits vary depending on your policy type, your super fund’s rules, and the review pathway. Don’t sit on a rejection letter – the sooner you seek advice, the more options you’ll have.

We’re Here to Help

Dealing with a rejected TPD claim while managing a serious injury or illness is hard. Local compensation lawyers understand what you’re going through and can explain your options clearly and honestly without any obligation. Compensation lawyers in Cairns usually operate on a No-Win No-Fee basis.

Disclaimer: This article is general information only and does not constitute legal advice. If you have a specific legal matter, please contact our office to discuss your individual circumstances.