Can I access my superannuation when I am injured and on workcover?

unlock-super-early

Well, some good news, for those poor injured folks – like me- put on starvation by their workcover insurer. You can unlock superannuation early if you are injured or ill and, as a result, are unable to work!

Can I access my superannuation when I am injured and on workcover?

All Superannuation schemes will release early accumulated funds and many also offer disability insurance and income protection up to 2 years (24 months). Many people are unaware of this!

Unlike WorkCover claims, it also does not matter how or where you were injured, what matters is whether or not you are able to work!

How can you access your superannuation fund?

There are several ways in which you may be able to unlock your superannuation fund.

1. Permanent incapacity

If an injured worker is – because of their workplace injury or illness- no longer able to return to work, and this is likely to be “for the foreseeable future” (permanent), you should be able to unlock your super fund. The fund includes your employer contributions as well as your own (if you made any).

The best part is that when your claim is approved you are allowed to use the funds immediately.

Note that taxation applies to super, however injured workers can withdraw their ‘benefits’ taxed at a concessional rate and some (or all) of the disability benefit is tax free. [But just check with your super fund.]

2.Total and permanent disability or death

Many injured workers may also be entitled to an insurance payout on the grounds of disability. Again, many workers are  unaware of the ‘built-in” benefits of many Super funds, and a very common one is disability insurance. This means that you may be able to get your super account balance as well as the extra amount for which you are inured (by the premiums you paid through the fund!). Go check out your super!

Also, many super funds include insurance extras such as death benefits to family member – so if a member of your family passes away, check out with your super whether you are eligible for a “death benefit” [lumpsum].

What’s more, the insurance extras often include payment of lump sum death benefits to a family member. So if a member of your family passes away, you should find out from their Super fund whether you can claim a Death Benefit.

Tips of how to look for superannuation cover

Superannuation funds vary in their approach and coverage. Not all funds offer insurance but many do.

You can search for Superfunds to which you have contributed during your working life (if you don’t know them) using the SuperSeeker tool on the Australian Taxation Office website.

Best is to contact your super fund and check the “fine print” and see whether you are covered for extra insurances. You may also want to discuss the “fine print” with your solicitor.

However, remember that injured workers can still apply to unlock (and take out) their superannuation fund if they are unable to work.

 

I certainly know what I will be doing today 😉

 



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4 Responses to “Can I access my superannuation when I am injured and on workcover?”

  1. This site is a God-sent – thank you again for another invaluable article – you have just saved my life, literally! I have been able to talk to my Super today and found out that I can access 18 years of accumulated funds as well as disability insurance! Nobody had ever told me this!!! Forever indebted.

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  2. Regarding disability insurance, some lawyers offer a flat fee of around $20,000 to help sort your insurance out (!), however, you may choose to simply lodge the disability form yourself if there is a likelihood of acceptance and engage a lawyer if there is a difficulty or your claim is rejected.

    However, you must remember to roll over any TPD (total permanent disability) benefit into an approved fund to avoid the preclusion period regarding weekly payments as set out in section 96 of the Act!

    So if you still are getting weekly payments, even if you can’t live of them, you are still screwed by our lovely workers comp system! (and can’t access the $$$).

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    workcovervictim May 10, 2012 at 4:49 pm
  3. hi, i am still technically employed but have been off work since Late 2012. I am currently in receipt of income protection and my claim for TPD is currently being assessed, both these insurances are attached to my super. Am I able to access my superannuation funds now? , and how do i go about it?

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    • @Maria – as recently posted on our I need help page
      Super Funds pay out lots of dollars in income protection and disability insurance each year to injured workers who are unable to return to work full time, or not at all.

      This money is paid through the insurance schemes that are almost always an overlooked feature of people’s Super. They work in much the same way as any stand-alone disability or death policy and come packaged in your Super plan.

      Claims can be made on the insurance policy contained within your Super fund no matter where or when you were injured. It needn’t be at work. It could have been a road accident for example.

      The entitlement is determined simply on the basis of whether you are able to work.

      Furthermore, you can access your own Superannuation savings early, or before retirement age, should you be unable to return to work – without any financial penalty.

      There are two types of disability insurance, one for total and permanent disability, which pays a lump sum if you can prove that you are unlikely to work again (ever), and one called income protection that replaces your income for a period of time while you cannot work. The former may offer more money but is harder to prove (quite a few injured workers have not been able to obtain TPD… see I need help comments). The second type (income protection) is easily accessed.

      Your workcover claim (incl common law) does not affect your entitlement to TPD claim (if eligible). On average a lawyer will charge a flat fee of around $8000 to sort it out for you.

      Alternatively you can contact your Super directly and obtain the relevant forms to make an application.

      Maria, and other interested folks out there, our next article will cover in detail all things TPD and Super, stay tuned.

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      Workcovervictim3 June 15, 2014 at 9:59 am