If you have lived in Australia (as a citizen, resident or otherwise) and worked in Australia, it’s very likely that you received superannuation contributions. And, if you have received super contributions, there is a good chance you have been provided with life and disability insurance coverage, like TPD or income protection. You may also have made a conscious decision to purchase a policy of insurance when you lived in Australia.
Most disability and life insurance policies, including policies that provide TPD, income protection and life benefits, will continue to cover you if you leave the country temporarily. However, the situation becomes more complicated if you relocate permanently. Each policy is different and must be checked for your individual circumstances.
This blog looks at some of the general issues that arise relating to disability insurance cover when you relocate overseas or travel overseas.
Does my disability or life insurance cover continue when I permanently move overseas?
Every person that moves overseas should ask this question and make enquiries before relocating. The answer will depend on the wording of the relevant policy of insurance.
Most policies (whether held in super or stand-alone) will provide for the continuation of disability insurance coverage like TPD or income protection for people no matter where they are in the world. However, there are some exceptions, and the coverage is not always automatically extended. It’s important that you make enquiries with the relevant super fund or insurance company.
Also, you should be aware that superannuation-based coverage may stop providing you with cover, unless you make arrangements for the cover to continue. Your insurance cover may cease if:
- you withdraw your superannuation account balance, or the balance drops below $6,000; or
- you do not make a contribution to the account for 16 months.
Under the relevant law, the super fund is supposed to notify you that the cover will stop if any of the above occurs. Therefore, it’s very important that you update your address and/or elect to receive correspondence from your super fund electronically when you move overseas.
Also, some policies provide exclusions on the insurance cover (and claims) if you travel to certain hazardous destinations that the Department of Foreign Affairs and Trade (DFAT) has provided adverse travel guidance in relation to.
So, in most cases, it is possible to continue your insurance coverage if you no longer reside in Australia. However, what about making a claim on that insurance policy?
Can I claim on an Australian TPD, income protection or death policy if I now live overseas?
The impact of moving or being overseas on a disability insurance claim will depend on the following:
- The benefit which is being claimed - income protection, TPD or death will have different requirements;
- The specific terms set out in your policy.
Income protection claims if living overseas
Under most income protection insurance policies, claimants are permitted to go overseas for holidays or even for extended trips without any impact on their entitlements. Also, people who reside overseas are often still entitled to be covered under income protection policies and make claims on them if they become sick and unable to work.
Having said that, there are some practical issues that arise if a person that is receiving income protection benefits decides to move or travel overseas.
For example, to be paid an income protection benefit each month, a person usually needs to provide a certification by a doctor that they are unable to work. This can be managed if you are heading overseas for a trip or holiday, provided that you have access to your usual doctors (via Telehealth consults) or other doctors.
However, most insurance policies require that ongoing certifications of work incapacity be provided by Australian doctors or doctors with qualifications obtained from specific countries (for example, the UK, New Zealand, US, Germany etc).
Each policy is different with regard to what qualifications certifying doctors must hold. This means that if you don’t have access to your usual doctor or if your usual doctor is not an Australian doctor (or is otherwise not a doctor qualified to provide certification under the policy), the insurer may reject your claim. You should seek legal advice if this happens.
Also, under some policies, there are restrictions on how long you can be overseas and receive income protection benefits.
For example, we once helped an Irishman who obtained insurance cover through his super in Australia and then relocated back to Ireland. He maintained the insurance cover without incident whilst in Ireland, but when he went to claim, clauses in the policy required him to return to Australia after being on claim for six months in order to have an ongoing entitlement to payments under the policy for income protection benefits. He was unable to travel for medical reasons, and we were able to get around this requirement, but it did cause issues on the assessment of the claim.
Total and permanent disability (TPD) claims if living overseas
Under most TPD policies, there are no restrictions on:
- claiming whilst residing overseas;
- travelling overseas during the claims assessment.
If you do need to travel during the claims assessment period and you have your doctor’s support for the proposition that you can travel but not work, we think that travel during the claims assessment period would be possible.
TPD claims for those that are residing overseas are also usually permitted. These claims are usually subject to the same issues relating to the qualifications of doctors who are able to sign off on the TPD claim. In other words, sometimes the doctors must be either Australian doctors or doctors that are qualified to practice in the United States, the United Kingdom, New Zealand or other specified countries.
However, provided that you’re able to get the medical evidence that you need to support the claim, and the insurer is able to arrange for you to attend medicolegal assessments in the country that you reside in, claiming a TPD benefit whilst living outside Australia is usually permitted.
Death claims
Most superannuation-based or stand-alone life insurance policies will provide cover for death and terminal illness to people whilst they are travelling or residing overseas. Further, provided that a death certificate or equivalent can be obtained and produced to the insurer as part of the assessment of the claim, these claims usually go through without consequence.
Sometimes, people who are travelling overseas take more risks than they would do if they were at home in Australia. For example, they may drink more, take illicit substances or engage in other risky activities like sky diving, scuba diving or riding motorbikes. Under some policies, claims can be denied if the cause of death is linked to a riskier or otherwise illegal activity.
Get help from a disability insurance lawyer
We have helped many people living overseas to claim insurance benefits, including TPD, income protection and death and terminal illness benefits. We have also helped a number of others negotiate travel and assist with the necessary arrangements to keep being aided whilst travelling.
If you require assistance on issues relating to the above, please get in touch.
Contacting Berrill & Watson
📞 Melbourne: 03 9448 8048
📞 Brisbane: 07 3013 4300
📞 Anywhere else in Australia: 03 9448 8048
How we charge
We are Australia's best-value superannuation/insurance law firm. Other law firms charge nearly double (& sometimes more than double) what we charge. So, if you get a quote from them, or have a cost agreement, ask us what we will charge you.
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