One such member, Shannon Pincombe, lodged an income protection claim in September 2022 after being unable to work due to a back injury. Despite providing all required medical documentation, Mr. Pincombe experienced a delay of approximately ten months before receiving a response from the fund's insurer, TAL. During this period, he faced severe financial strain, relying on borrowed funds to meet his living expenses.
Mr. Pincombe's experience is not isolated. The Australian Securities and Investments Commission (ASIC) has initiated legal proceedings against Australian Super, alleging that between July 2019 and October 2024, the fund failed to handle nearly 7,000 death benefit claims efficiently, with some delays extending up to four years. ASIC's Deputy Chair, Sarah Court, emphasized the gravity of the situation, stating, "We are particularly concerned when, at a time of deep distress, the actions of a super fund contribute to making a difficult situation even harder."
These delays have raised questions about the efficiency and responsiveness of superannuation funds in managing insurance claims. For policyholders, timely processing of claims is crucial to maintain financial stability during periods of illness or injury. Prolonged delays can exacerbate stress and financial difficulties, undermining the very purpose of holding such insurance.
In response to the criticism, Australian Super has acknowledged the backlog and attributed it to a sharp increase in member deaths post-COVID. The fund has since brought some of its claims processing functions in-house to improve efficiency and has expressed a commitment to addressing the issues raised by ASIC.
For members, this situation underscores the importance of understanding the claims process and maintaining open communication with their superannuation funds. It's advisable to keep thorough records of all communications and submitted documents and to seek professional advice if experiencing undue delays.
As the legal proceedings unfold, it remains to be seen how Australian Super will address these challenges and what measures will be implemented to prevent future delays. Policyholders should stay informed and proactive to ensure their rights and financial well-being are protected.
