Super fund insurance: A case study in obstruction
As the Royal Commission into financial services swings into gear, here is an example of why the inquiry is so necessary, especially when it comes to Super Funds employing blatant delay tactics causing their members to suffer increased stress and financial hardship.
Here we present a case study in procedural delays that amounts to obstruction by a super fund in meeting its obligations to a genuinely ill member.
This woman, who is a client of ours, has cancer. She was a member of super fund up to 13 February 2004.
She stopped work due to illness in 2002 and has never returned to work.
Like many people, this woman was unaware of the superannuation insurance entitlements that she may have held with the fund.
Also, due to the nature of her illness she was not in a position mentally or physically to follow through with initial enquiries she made to the Super Fund in 2003 and 2013.
It wasn’t until she became involved with a great support group called Grey Matters that she was referred to Ryan Carlisle Thomas.
On her behalf, we wrote to her fund in March 2017 and we were told in response that, their Trust Deed requires members to make an application within 6 months after ceasing to be an employee and as that time period had now lapsed, the member no longer has any insurance entitlements through her super fund.
In response, we continued to request information from her fund noting: “a super fund’s obligations to act reasonably and in the member’s best interests in accordance with the Insurance Contract Act 1984”.
The matter was then referred to the fund’s legal team and we eventually received correspondence on 28 August 2017 that they would consider a Total and Permanent Disability application provided Ryan Carlisle Thomas supply the application, medical reports and supporting information at our own cost.
Due to the time consuming task of having to provide all of the required documentation, it is only now that we are finally in a position to submit our client’s TPD application.
In the meantime our client’s health has declined significantly. She is currently undergoing chemotherapy and following this her options are quite limited.
Without the assistance of a third party, often legal representation, members are not always in a position, due to physical or mental incapacity, to question their super fund as to their entitlements or challenge their response when told they are unable to make a claim.
The super funds need to be reminded of their obligation to their members, particularly to act in a timely manner.