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No statute of limitations on super mistakes
There is no statute of limitations applying to superannuation funds and their administrators fixing errors, according to a recent determination of the Superannuation Complaints Tribunal (SCT).
The determination saw a superannuation fund and its insurer required to restore total and permanent disablement (TPD) cover to a member who had been wrongly designated as working part-time decades earlier.
In overturning the decisions of the superannuation fund and its insurer, the SCT said it accepted on the evidence before it that the complainant had been denied cover for TPD as a result of administrative errors on the part of the trustee.
"Had these errors not occurred she would have had TPD cover from the time of her first joining the fund," it said.
The SCT determination declared that the "primary obligation on the part of the trustee, once it has been appraised of errors is to correct them".
"There is no statute of limitation applicable to this obligation. In the opinion of the tribunal it is neither fair nor reasonable for the trustee to deny the complainant access to cover because of its errors," the determination said.
It said that the trustee had advised that the premiums payable for TPD insurance from 10 February 1992 to 11 February 2010 totalled $860.35 and ordered the superannuation fund to offer the complainant the opportunity to lodge a TPD claim with the fund on the condition that the complainant pay any outstanding premiums for the TPD benefit. How this is achieved is in the hands of the trustee.
"The complainant would have to lodge a claim, should she so wish, and be assessed under the terms of the policy. The tribunal notes that there is no guarantee that her claim would succeed. The insurer is on risk and would have to assess any claim that is made in the ordinary manner," the determination said.
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But if the super fund was transferred to the ATO, under the spurious "inactive account" system, & the insurance cover lapsed, rendering the member potentially uninsurable in the future, the Fed Govt takes no legal responsibility.