Is the TPD claims process creating additional harm?

While most of us breathed a sigh of relief as the worst-case scenario for Tropical Cyclone Alfred didn't materialise, insurance has been on the minds of many of us.

- Rebecca Scarrabelotti, Brisbane Independent Financial Advisory

If your home were significantly damaged or even burned down (tragically the case for our neighbours in the storm), could you move on with your life and wait for over a year for your insurance claim to be paid out? What if you were in an accident that saw you land in hospital, unable to speak or move? How quickly would you expect your insurance claim to be paid out? Is waiting four months reasonable? One year? How about two years?

With lengthy delays becoming what seems to be the norm with insurance claims being paid to policy holders, some of the unspoken reality that I see from personal experience with my clients is the despair, frustration, and hopelessness they quite rightly feel because of going through the insurance claim process itself.

Of particular concern is the process for Total and Permanent Disablement (TPD) cover. Like life insurance, TPD cover provides a lump sum payment. With life insurance, the policy holder's beneficiary receives the payment. However, TPD cover is instead paid to the policyholder themselves while they are still alive, helping them to plan for and fund their life with the disability.