TPD
Claims.

The Failure of GP Reports: GPs are excellent for treatment but poor for forensic reporting. Certificates that say "unfit for work" imply a temporary state. Insurers lean on this to argue the disability is not permanent.

Framing the Right Question: Advocates must transition the claimant into a medico‑legal phase. Specialist reports should mirror policy wording, e.g. "Considering the patient’s education, training, and experience, is it your opinion they are unlikely to ever engage in gainful employment for which they are reasonably suited?"

The Psychiatric Pivot: Physical impairments plateau; insurers will always suggest "sedentary roles". The true battleground is secondary psychological injury—chronic pain disorder, major depression, PTSD—which affects concentration, memory, and executive function. These often close off even sedentary work.

Neuropsychological Evidence: In complex cases, a neuropsych assessment provides objective data (percentile scores for processing speed, working memory, etc.). A claimant operating at the 5th percentile due to pain and medication side‑effects is effectively unemployable in fast‑paced admin roles the insurer suggests.

Procedural Fairness & Utmost Good Faith: Section 13 of the Insurance Contracts Act implies a duty of utmost good faith into every policy. Endless delays, repeated IMEs, and selective use of evidence can all breach this duty.

Constructive Declinations: If a TPD claim has been on foot for 6+ months without a decision, lodge a dispute with AFCA alleging a constructive declination and breach of Section 13. This forces the insurer to either decide or justify the delay.

The Procedural Fairness Letter: Before declining, insurers usually send a PF letter outlining the evidence they plan to rely on. Treat this as your pre‑decision hearing. Respond with a detailed submission that highlights cherry‑picking, misquotes, and conflicts with treating specialist evidence.

The "Reserving" Lever: In TPD, once a claim is lodged, capital must be reserved (e.g., $200k). A strong evidentiary brief (ETE, medical, employability) makes it commercially rational for the insurer to settle at 80–90% to release reserves and avoid litigation/AFCA risk.

Insurer-initiated debt recovery (subrogation) is a volume business. Letters of demand against uninsured drivers or policyholders are often automated and rely on fear, not legal certainty.

Subrogation Basics: The insurer only ever steps into the shoes of their insured. They have no better rights than the original driver would have had in a private lawsuit. Until a court judgment or binding settlement exists, the "debt" is unliquidated damages, not a true, recoverable debt.

5.1 Strict Proof Strategy

Never concede liability or quantum based on a demand letter. Demand strict proof:

• Liability: Request the insured’s signed version of events, any CCTV/dashcam, and witness statements. Raise contributory negligence wherever plausible.
• Quantum: Demand assessor’s reports and tax invoices (not quotes). Challenge "rectification of pre‑existing damage" and apply betterment where repairs improve the car beyond its pre‑accident condition.

5.2 Credit Hire & Loss of Use

Credit hire claims often include inflated daily rates. Case law limits recovery to the reasonable market rate and only where there is genuine need for a replacement vehicle. Three quotes from mainstream hire companies for the same period can slash claimed amounts and force commercial settlement.

5.3 Financial Hardship & Part 10 GICOP

GICOP Part 10 extends hardship protections to people owed money by insurers and to those the insurer is pursuing for recovery. An uninsured driver can lodge a hardship application, forcing a freeze on recovery while a Statement of Financial Position is assessed.

Where the debtor is effectively judgment‑proof (no assets, income from Centrelink or below poverty line), the cost of litigation dwarfs recoverable sums. This is leverage for a nominal "nuisance" settlement (e.g., $500 on a $20k claim) or full waiver.

5.4 Section 54: The "Uninsured" Policyholder

Where an insurer pays a third party but sues its own policyholder (e.g., for an unlisted driver), Section 54 of the Insurance Contracts Act is a shield. If the exclusionary act (unlisted, under‑25 driver) did not cause the accident, the insurer cannot deny the claim outright—only reduce it by the extra premium that would have been charged.

When a vehicle is declared a total loss, the core dispute is indemnity: will the payout actually replace the car? Insurers defend the loss ratio by relying on guidebooks and opaque salvage values.

6.1 Market Value vs Guidebooks

Policies usually promise "Market Value"—the cost to buy a similar vehicle in the local market. Redbook/Glass’s figures are statistical aggregates and often lag real conditions (e.g., COVID‑era price spikes). AFCA routinely prefers concrete market ads over rigid guide numbers.

6.2 Building a Valuation Dossier

• Collect 3–5 comparable listings: same make/model/badge, year ±1, odometer within ~10%, same state.
• Document pre‑accident condition with service logs, receipts for major work, and recent tyres.
• Argue for above‑average grading where evidence supports it, challenging blanket "average" labels.

6.3 Salvage Value & CTL

Insurers often inflate salvage values to reduce payouts. Demand the salvage tender outcome: if the highest wrecker bid is $500, a claimed $3,000 salvage deduction is indefensible.

On borderline constructive total loss (CTL) cases, negotiate cash in lieu: the insurer pays the repair cost (often minus GST) directly to you, you keep the car and salvage rights, and the vehicle avoids the Written‑Off Vehicle Register where appropriate.

This playbook rests on a small cluster of powerful legal levers.

• Insurance Contracts Act 1984 (Cth): Section 13 (utmost good faith), Sections 21/20B (reasonable care not to misrepresent), Section 54 (curing non‑causal breaches). Cases like Maxwell v Highway Hauliers confirm that technical breaches cannot be used to defeat substantive entitlements where risk has not changed.
• Corporations Act 2001 (Cth): Post‑Hayne reforms underpin the Cash Settlement Fact Sheet (CSFS) regime, forcing insurers to admit inflation and quality risks when pushing cash settlements.
• Superannuation Industry (Supervision) Act 1993 (Cth): Governs benefit release conditions and shapes how and when TPD benefits can be accessed from super.

AFCA’s Fairness Jurisdiction

AFCA is not a court and is not bound to strict contract law. It must decide what is fair in all the circumstances. This allows:

• Overriding harsh definitions (e.g., extreme ADL tests) where marketing created a different reasonable expectation.
• Preferring real‑world valuation evidence over guidebooks.
• Awarding non‑financial loss (stress, inconvenience) for mishandled claims or Section 13 breaches.

Advocacy is as much psychology as law. Every insurer decision-maker is driven by KPIs: file closure times, reserve adequacy, and complaint ratios.

Leaning on KPIs: Make it clear that an unfair decision will go to AFCA, keep the file open for years, and potentially generate negative systemic findings. Often, paying an extra few thousand dollars is the cheapest way for the officer to protect their metrics.

Cost-of-Litigation Reality: In defended debt matters, insurers know it can cost $5k–$10k to run a small claim to hearing. A robust Defence and a credible willingness to proceed makes 50% settlements or write‑offs highly attractive.

Integrated Advocate Mindset: The effective advocate acts as lawyer, medical investigator, labour‑market analyst, and negotiator. Across TPD, debt recovery, and valuation disputes, the objective is always the same: reverse the assumed onus, forcing the insurer to justify its position with evidence that will withstand AFCA or court scrutiny.