QLD Income protection group policy gone wrong

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10 December 2019
Hey guys. I’d appreciate your advice on an issue I’m having.

I broke my arm at home 8 weeks ago. I’m a tradesman so I haven’t been able to work. Luckily I’ve had savings and paid leave to use during this time.

But I’ve been paying quite a high premium for income protection for three years now for 90% of my pretax income to be covered. It’s a group policy and our employer is the policy holder. I figured I may as well make a claim to use it and then leave my savings alone.

I made the claim a month ago and the statements confirmed my level of benefit was 90%. Except the payment amount is much lower. It works out to be about 60%. I call them up and was told “oh it’s capped at $xx” despite any percentage.

I’ve gone through the PDS twenty times and see no mention of this cap. The example they use in the PDS is pretty much exactly my situation and it explains the 90% calculation.

Like I said I’m lucky to have savings and I’ll be back at work soon anyway but I’ve been paying for this for three years now and it’s not what I thought it would be. If I had a more serious accident and had to be off work for longer this would not suffice.

I called the insurer again today and spoke to someone else. They were able to tell me that my employer put the cap on our paid benefits in December 2018, and that the union and employer agreed to this because too many benefits were being paid out.

So it seems this is now an issue with us and our employer. The insurer says they weren’t liable to tell me because it’s a group cover and the employer should have. My employer is still denying they received adequate notification of the cap, but the insurer has since provided evidence of the statements going to our payroll that had details of the cap written on it.

I feel uncomfortable approaching my employer about this Legally. Especially because they are still denying it and fighting with the insurer. Meanwhile I’m sitting here losing money I’ve been paying high premiums for.

The other point to note is that this was actually in our EBA so does this mean my employer technically breached it?