Calls for insurers to only pay medical bills a ‘Trojan horse’

life insurance insurance illness claims

10 August 2020
| By Jassmyn |
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The Financial Services Council’s (FSC’s) campaign to change the law to allow insurers to only pay medical bills of sick workers instead of the entire insurance claim is a “Trojan horse to push past privacy and other legal rights”, Maurice Blackburn Lawyers believe.

The law firm’s principal, Josh Mennen, said renewed calls for greater involvement in worker rehabilitation was part of a push to expand insurer’s powers so fewer claims would need to be paid out.

“The FSC has itself acknowledged that the opportunities for disability insurance claimants to return to work are extremely limited under normal circumstances, let alone under the current economic crisis engulfing Australia,” he said.

“It’s therefore irresponsible to suggest that an insurer should be calling the shots on claimants medical treatment plans in an attempt to get them back into a severely diminished job market.

“What insurers should be instead focusing on is the ongoing and timely payment of legitimate claims so that disabled consumers can afford the medical and other support they need – and without the inappropriate interference of an insurer in those therapeutic relationship.” 

Mennan noted the proposal had been previously rejected by a Parliamentary Joint Committee in 2018 which recommended the Australian Securities and Investments Committee to conduct an investigation into the use of in-house rehabilitation services by insurers.

“The Parliamentary Joint Committee made a series of sensible findings and recommendations which would ensure that consumers were protected from potential insurer overreach,” he said.

“While it appears to be altruistic, the FSC’s campaign to change the law has always been a Trojan horse to push past the privacy and other legal rights of their disabled claimants and gain greater control over their medical treatment.

“Until the Committee’s recommendations have been faithfully completed and the findings of the ASIC investigation are released, then any calls for an expansion of a life insurer’s rights in the medical decisions of claimants is premature and unwarranted.”

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