If your insurer is delaying your TPD (Total and Permanent Disability) claim, you have clear legal rights and a range of practical steps you can take to get the compensation you are entitled to. Most TPD claims are decided within 6 months of the submission of complete documentation, and any delays you face beyond this timeframe are likely to be considered unreasonable.
These delays can be incredibly frustrating, especially while you're unable to work and under increased financial pressure stemming from your condition. You're entitled to regular updates, reasonable assessment timeframes and potentially penalty interest if your insurer is dragging their feet without valid reason.
This guide explains what constitutes an unreasonable delay, all your legal rights under Australian law and the specific steps you should take in the event your claim is stalled.
Quick Answer Box
Your Rights When Claims Are Delayed:
- Insurers are expected to make decisions within 6 months of receiving all necessary information
- You can lodge a formal Internal Dispute Resolution (IDR) complaint after 28 days
- You can escalate to the AFCA (Australian Financial Complaints Authority) if the IDR process fails
- You may be entitled to penalty interest under Section 57 of the Insurance Contracts Act in the case of an unreasonable delay
Key Timeframes:
- Standard claim processing: 6-12 months
- IDR complaint: must be lodged within 28 days of insurer's decision
- AFCA escalation: available after 45 days if no IDR response, or within 2 years of final IDR decision
Next Steps: ensure you document all communication pertaining to your claim, request written updates every 30 days and prepare to lodge an IDR complaint if delays continue beyond 6 months. In almost every case, it is recommended to seek legal advice as early as possible.
Understanding TPD Claim Delays
What is considered a reasonable timeframe for TPD claims?
Most TPD claims take 6-12 months to process from the date you submit all the required documentation. The usual process involves a 3-6 month waiting period before you can lodge your claim, followed by the insurer's assessment period.
Reasonable timeframes include:
- Initial assessment: 30-90 days for the insurer to review your documentation and determine what additional information they require. This includes reviewing your medical history, employment records and policy terms.
- Medical assessments: 60-120 days if the insurer requests independent medical examinations. This timeframe accounts for scheduling appointments with specialists and getting detailed reports from them.
- Final decision: 30-60 days after receiving all required information. Your insurer should communicate their decision clearly, with detailed reasons if they deny your claim.
What makes a delay unreasonable?
The AFCA considers delays longer than 6 months to be unreasonable, unless there are exceptional circumstances. Your insurer is obligated to act in your best interests and process claims as efficiently as possible.
Clear warning signs of unreasonable delay include:
- No decision after 6 months from the date you submitted complete documentation
- Periods without communication from your insurer longer than 30 days
- Having to undergo more than two independent medical assessments without clear justification
- Being repeatedly asked for the same information or documents you've already provided
- Assessment requirements being changed after you've submitted your claim
Your Rights and Entitlements
Under Queensland law, you're entitled to:
- Regular updates: your insurer must provide you with written progress updates, especially in the event that your claim takes longer than 90 days. You have the right to know where your claim stands and what specific information is being assessed.
- Reasonable assessment periods: under the Life Insurance Code of Practice, insurers should make decisions within 30-60 days of receiving all the information they require. Complex claims may take longer, but your insurer must justify any extensions.
- Penalty interest: section 57 of the Insurance Contracts Act states that you can claim interest (currently around 8% per annum) if delays are deemed to be unreasonable. This is to compensate you for the time value of money you should have received earlier.
What you must do:
- Respond promptly: provide any and all information requested of you within 14-28 days wherever possible. Delays on your part can justify longer assessment times and may weaken your position if you need to escalate.
- Keep detailed records: document every conversation, email and letter, along with dates, names and outcomes. This is crucial evidence for if you need to prove unreasonable delay to the AFCA or a court.
- Meet policy requirements: ensure you've satisfied any waiting periods (typically 3-6 months) and policy conditions. Review your policy document carefully so you understand exactly what your insurer needs from you.
Key deadlines:
- 28 days after an unfavourable decision to lodge an IDR complaint
- 45 days from lodging an IDR complaint before you can escalate to AFCA (if no response)
- 2 years from the final IDR decision to lodge an AFCA complaint
- 6 years (generally) to commence court proceedings if needed
Common Scenarios and Questions
My claim has been "under review" for 8 months with no updates
Quick answer: this will likely constitute an unreasonable delay. You should immediately lodge a formal IDR complaint if you haven’t heard anything in this long.
What to do:
- Send a formal written request to your insurer's IDR department (not just your claims handler) specifically stating "Internal Dispute Resolution Request" in the subject line. Ask for an immediate decision or clear timeline in which you’ll get one, as well as justification for the delay.
- Reference specific timeframes in your complaint: "My claim was submitted on [date] with complete documentation. It has now been [X] months without a decision, which exceeds industry standards of 6 months."
- Request interim financial support if your policy includes provisions for partial payments or advances while claims are in the process of being assessed.
Important note: insurers are obligated to acknowledge IDR complaints within 5 business days and provide a decision within 45 days. If they miss these deadlines, you are entitled to escalate your case to the AFCA immediately.
The insurer keeps requesting additional medical assessments
Quick answer: multiple assessment requests are often indicative of delay tactics, especially if they keep asking for the same types of examinations.
What to do:
- Question each request in writing: request an explanation from your insurer specifically detailing exactly what information they need that wasn't provided in your previous assessments. Ask them to identify which policy provisions or medical questions remain unanswered.
- Learn the difference between reasonable requests (one comprehensive assessment by a relevant specialist) and unreasonable requests (multiple assessments by different doctors for the same condition). The AFCA has decreed that excessive medical assessments constitute unreasonable delay.
- Consider seeking independent advice before attending additional assessments. This is particularly important if you've already provided comprehensive medical evidence. A lawyer will be able to review whether the requests are justified under your specific policy.
Important note: mental health claims often require more assessment requests, but insurers are still obligated to justify them. If you're going through this issue, document the pattern and consider seeking legal advice to determine whether the insurer is acting in good faith.
I've received a denial after months of delay
Quick answer: you have 28 days to lodge an IDR complaint in challenge of both the denial and the delayed claim. You may be entitled to penalty interest in addition to your compensation if the AFCA overturns the decision.
What to do:
- Immediately lodge an IDR complaint which addresses both the merits of the denial and the unreasonable delay. Do not accept any decision as final until you've exhausted all your review rights.
- Request detailed written reasons which explain the exact reason your claim doesn't meet the policy definition of TPD. Insurers must provide specific justification, not just generic statements about policy terms.
- Gather additional medical evidence that directly addresses the insurer's stated reasons for denial. Focus on functional limitations and how your condition has prevented you from working.
Important note: many denials which come after extended delays are overturned by the AFCA, particularly when insurers fail to properly investigate claims or make unreasonable demands for evidence.
My mental health claim has been delayed for over a year
Quick answer: TPD claims related to mental health usually face longer processing times, but delays beyond 12 months are rarely justified.
What to do:
- Escalate immediately to the AFCA if you haven't already, as mental health claims are disproportionately delayed. The AFCA has recognised this pattern because mental health claimants are often more vulnerable, so they take this into account when assessing whether a delay is reasonable.
- Ensure your evidence addresses functional limitations, not just diagnosis. Explain exactly how your condition prevents you from performing your work duties (e.g., "I am unable to concentrate for more than 15 minutes" or "I cannot manage workplace stress or deadlines").
- Document the impact of delay on your condition. This is important because insurers may be liable for exacerbating your mental health as a result of their poor handling of the claim. If the stress of the claims process has worsened your condition, this should be raised with the AFCA as soon as possible.
Important note: the AFCA awards compensation for distress in cases where insurers subjected mental health claimants to excessive assessments or unreasonable delays.
The insurer says they're waiting for information I've already provided
Quick answer: if this happens, it’s usually indicative of failure on the part of the insurer and may constitute unreasonable delay.
What to do:
- Resend the information immediately, along with a cover letter detailing every document enclosed as well as the dates you first sent them. Use registered post or email with read receipts to prove delivery.
- Reference your previous submissions with specific dates and proof of delivery (tracking numbers, email confirmations, postal receipts, etc.). It’s important that you make it clear this is a resubmission of materials you have already provided.
- Request confirmation that all documents have been received by your insurer and are complete. Ask them to specify if anything further is required in writing, along with a deadline for their response.
Important note: insurers are not allowed to delay TPD claims based on missing information if you can prove you provided it previously. Always keep copies of everything you send.
How long does the AFCA process take?
Quick answer: the AFCA aims to resolve complaints within 90-180 days, although complex cases can take longer.
What to do:
- Lodge your AFCA complaint online on the AFCA website. This process takes around half an hour and will trigger immediate attention from your insurer. Many insurers will contact you to settle once the AFCA gets involved.
- Respond promptly to all AFCA requests for additional information or clarification they may require. The AFCA's processes are less formal than the court’s, but they still require well-organised documentation and clear communication.
- Consider seeking legal representation for the AFCA process. This is always a good idea as lawyers with experience in TPD claims can significantly improve your chances of success. The AFCA does uphold around 80% of complaints regarding delayed claims, but strong presentation is still very important.
Important note: AFCA decisions are binding on insurers up to roughly $1 million for superannuation complaints, which covers most TPD claims.
Step-by-Step Process for Addressing Delays
- Document everything from the beginning: create a spreadsheet tracking every interaction you have with your insurer, including dates, staff names, what was discussed and any commitments that were made. Save all emails, letters and claim forms somewhere safe (digital and physical copies).
- Send formal update requests after 4 months: contact your claims handler and their supervisor to request a detailed status update, timeline for a decision and specific information still required. Send this both via email and registered post to get proof of delivery.
- Lodge an IDR complaint after 5-6 months: make a written complaint to your insurer's Internal Dispute Resolution department (separate from your claims handler) informing them of the specific delays pertaining to your case, referencing industry standards and requesting immediate resolution. Insurers must respond within 45 days.
- Escalate to the AFCA if IDR fails: if your insurer fails to respond within 45 days, or you're unhappy with their IDR decision, lodge an AFCA complaint online. This must be done within 2 years of the final IDR decision.
- Consider legal representation: seek legal representation from a lawyer who specialises in TPD claims. This is particularly important if your claim is complex, involves mental health conditions or has been delayed beyond 12 months. In any case, early legal advice can prevent costly mistakes and give you peace of mind.
- Prepare for mediation or determination: gather all medical evidence, employment records and relevant correspondence. The AFCA usually attempts conciliation before moving on to a formal outcome.
Documents you'll need:
- Complete correspondence file: every email, letter and note of phone conversations with your insurer. These must be organised chronologically. Always include proof of delivery for all documents you submit.
- Medical evidence package: all treating specialist reports, GP records, hospital records, diagnostic test results and rehabilitation reports covering the period from the onset of your injury/illness up to now. Ensure these directly address your policy's TPD definition.
- Employment and financial records: job descriptions, duty statements, pre-disability income evidence (payslips, tax returns, employment contracts, etc.) and evidence of any failed attempts to return-to-work.
- Policy documents: your complete insurance policy, including the Product Disclosure Statement (PDS), policy schedule and any amendments. Knowing the details of your specific policy definition (own occupation vs any occupation) is critical.
- Timeline of delay: you’ll need to present a clear, chronological summary demonstrating when you lodged your claim, what the insurer requested, when you provided it, periods of silence and the total time that has elapsed. This is to demonstrate the pattern of delay.
Red Flags and Warning Signs
When to act immediately:
- If there’s been no communication for more than 30 days despite your requests for updates, your claim is likely not being actively assessed or has been lost in the insurer's system.
- The sixth month deadline is approaching without a decision or clear timeline, as this is the threshold the AFCA typically considers for unreasonable delay.
- Repeated requests for information you've already provided at least once, as this indicates an administrative failure or even deliberate stalling tactics.
- The insurer misses their own deadlines repeatedly without explanation or apology, as this demonstrates that they're not taking your claim seriously.
- You receive generic "under review" responses without specific details about what's being reviewed, who's reviewing it or when you can expect a decision.
Common mistakes to avoid:
- Waiting too long to escalate: you should never assume that delays will be resolved on their own. Once 6 months elapses, take formal action through IDR and potentially the AFCA.
- Accepting verbal assurances without written confirmation: always request all updates to be made in writing via email or letter. Verbal promises are difficult to prove later.
- Failing to keep copies of everything you submit to your insurer: use registered post or email with read receipts and maintain your own complete file.
- Missing IDR or AFCA deadlines: you only have 28 days after a decision in which to lodge an IDR complaint, and 2 years after IDR to lodge with the AFCA. These deadlines are strict and missing them can greatly harm your prospects.
When to Seek Legal Advice
As a rule of thumb, it is always recommended to seek legal advice as quickly as possible. This is especially important if:
- Your claim has been delayed for more than 6 months without a valid explanation or decision.
- Your financial situation is becoming desperate and you need help accessing interim support or expediting the process.
- You've lodged an IDR complaint that wasn't successful and need help preparing for AFCA.
Seeking early advice from an experienced lawyer is important because:
- A lawyer can help you fully understand your full rights and entitlements under your specific policy and Australian law, avoiding costly mistakes that could jeopardise your claim.
- They will also hold insurers accountable for unreasonable delays and can even claim penalty interest for the time you've been without support.
- Ensuring you meet all critical deadlines and procedural requirements for IDR complaints, AFCA escalation, and any court proceedings is critical, and they will ensure you don’t miss any of them.
Key Takeaways
Remember these essential points:
- Six months is the standard maximum for TPD claim processing from when you have submitted complete documentation. Delays beyond this are likely unreasonable unless there are exceptional circumstances involved.
- You have formal escalation rights through Internal Dispute Resolution (IDR) and then the AFCA if your claim is delayed or denied. These processes are free and are often highly effective.
- Document everything meticulously, including all communications, dates, promised deadlines and proof of delivery for any documents you submit. This evidence is crucial for proving unreasonable delay.
- Penalty interest is available under Section 57 of the Insurance Contracts Act for unreasonable delays, potentially adding thousands of dollars to your final payout.
- Early legal advice helps prevent mistakes and can significantly improve your chances of success, particularly for complex claims or those involving mental health conditions.
Get Help Now
If your TPD claim has been delayed and you're uncertain about your rights or the best next steps, getting early legal advice helps you understand your options, hold your insurer accountable and get the financial support you're entitled to.
Delays in TPD claims can have a serious financial and emotional impact, particularly when you're unable to work and facing mounting expenses. You don't have to navigate this frustrating process alone.
Contact Smith's Lawyers today for a free, no-obligation consultation with lawyers experienced in delayed TPD claims under our No Win, No Fee, No Catch® promise.
You don't pay unless your claim succeeds, so call us on 1800 960 482 or use the form below to have our team contact you at a convenient time, and we'll assess your situation, determine your state of connection and guide you through the claims process in the correct jurisdiction.
