How many life and TPD insurance claims get rejected in Australia?

We know all too well how intimidating it can feel to have a TPD or life insurance claim be denied. The most important thing to remember though is it’s not that uncommon, and it doesn’t mean that’s that. You do have options and steps you can take to potentially have the decision changed.

In fact, recent data released by the Australian Prudential Regulation Authority (APRA) shows just how many of these types of claims are approved and declined, and how common it can be for people to take these extra steps to access the support they deserve.

Key findings

TPD claims are longer and more complex than life insurance claims

Compared to 91% of life insurance claims coming back approved within the month of submission, only 65% of TPD claims come back approved that quickly. Overall, these claims take longer and tend to be denied more often than life insurance claims.

Mental health claims have changed the TPD landscape

The rate of TPD insurance claims rose by 38% from 2019 to 2025, largely due to the increasing rate of mental health concerns causing Australians to leave the workforce for good.

Disputes have proven success in improving results

In December 2025, 65% of disputes on life insurance claims successfully changed the original decision (meaning either the decision was reversed, or they likely reached a settlement with the insurer).

In the TPD space, over 66% of disputes resulted in the original decision being changed for the better. However, it’s likely there are plenty more cases that could have been overturned that weren’t disputed at all.

Explaining the data

Throughout some of our analyses, we’ll refer a lot of different groups, which all vary based on how someone was insured. They key groups here are:

• Group super – This makes up most Australians with life or TPD insurance. People in this group didn’t go out and buy a specific policy just for them. Instead, their policy is held within their superannuation fund, and payments are deducted automatically from their super balance.

• Individuals advised – These are people who bought their insurance themselves (whether that’s life insurance, TPD, or something else relevant) with help from financial advice.

• Individuals non-advised – These are the people who didn’t get any advice and bought themselves a policy just for them.

• Group ordinary – These are the people who have their policies owned by a separate group (usually the company they work for). It runs pretty much the same way as the ‘Group super’ cohort, but in this case, premiums come off their salary before tax.

TPD insurance claim statistics Australia

TPD insurance policies held in Australia (2019-25)

Given rates of life insurance decreased over time, it’s not surprising to see a bit of the same trend applying to TPD insurance. But the key difference is that in 2025, there was a resurgence of people having TPD as a part of their group super.

Workplace hazards and the ongoing effects of severe mental health concerns have both been given a lot of awareness in recent years. So it makes sense that concerned workers might be ready to invest in having a TPD policy in place, just in case they need it one day.

TPD insurance claims received (and rates) in Australia (2019-25)

There’s been a noticeable increase in the rate that TPD claims are being made, from 262 claims per 100,000 policies in 2019 to 361 claims per 100,000 policies in 2025.

That 38% increase, according to the Council of Australian Life Insurers (CALI), is primarily due to the ongoing increase in mental health concerns affecting Australians. They reported in July 2025 that the rate of TPD claims for mental health among Australians in their thirties had increased by over 700%.

TPD insurance claims and outcomes in Australia (December 2025)

Looking at life insurance claims in the same time period, we see that about 93% of claims were finalised within December 2025, and 91% of all claims came back admitted within the month.

Comparing that to TPD and we see a very different set of results. Instead, only 72% of claims were finalised within December, and only 65% of all claims came back admitted.

That leaves far more people who submitted their claims wondering what their result will be, or questioning what to do next if their claim is denied.

Shine Lawyers’ Head of Disability and Superannuation, Ann Meakins, has a very clear belief that how TPD claims work isn’t fair at all on the person making the claim:

"As someone battles the toughest medical challenges they’ve ever faced, expecting them to navigate complex policy definitions, identify and submit favourable evidence to the insurer and push insurers to make decisions sooner rather than later is grossly unfair. That’s why we do what we do. We would be able to step in and handle the complexities and mental load so you can focus on your wellbeing."

TPD insurance disputes and outcomes in Australia (December 2025)

Even though the prospect of disputes and settlements in TPD claims can be daunting, the nation-wide statistics offer a glimmer of hope. Only 2,110 (33.5%) of the 6,290 resolved disputes resulted in the original decision being maintained. That means an incredible 66.5% of disputes achieved either a reversed decision, or a separate outcome like an agreed settlement amount.

What this data doesn’t show, however, is how many declined claims weren’t disputed when the person should have accessed their entitlements. It’s a sad but realistic assumption that as someone is declined while already navigating the toughest challenges they’ve faced in life, they didn’t know how to right what was wrong.

Life insurance claim statistics Australia

Life insurance policies held in Australia (2019-25)

It’s worth saying upfront that while these are four very separate buckets, it’s common for people to have policies in several of them (or even multiple policies in the same bucket). And it’s the same with the TPD data we’ll get to later.

Say you have two different superannuation accounts. Without knowing it, you may be paying fees for two separate life insurance policies. Or maybe you never cancelled the policy attached to your super, and had a financial advisor help you buy an individual policy.

But aside from potentially double-policies, the interesting trend emerging in Australia is the declining rate of life insurance policies being held. The amount of life insurance policies held decreased by over 17% from December 2019 to December 2025.

ASFA has previously reported on this trend, saying it’s mostly caused by the government’s ‘Protecting Your Super’ (PYS) and ‘Putting Members Interests First’ (PMIF) schemes making insurances opt-in for younger workers, instead of being automatically included.

Life insurance claims received (and rates) in Australia (2019-25)

Policies taken out by individuals (regardless of whether they got advice along the way) had significantly higher rates of making claims. In December 2025, for every 100,000 active policies held by individuals who weren’t advised, there were about 320 claims made (well above the national average of 153 claims per 100,000 policies).

It could mean that people who are perhaps aware of their general health, or as they get older, want to ensure they have a specific and individual life insurance policy in place.

Life insurance claims and outcomes in Australia (December 2025)

Of the 31,880 finalised claims in Australia in December 2025, only 815 (2.5%) were declined. Granted, there were over 2,400 claims at this stage that had either been withdrawn or hadn’t been determined yet. But it shows a vast majority claims have positive results.

And as we’ll explore next in our disputes section, even those who don’t get immediately approved still have hope.

Life insurance disputes and outcomes in Australia (December 2025)

Across the 753 resolved disputes lodged in December 2025 on life insurance decisions, only 261 (35%) had the original decision maintained. That means that in 65% of resolved disputes, either the decision was entirely reversed, or the person making the dispute was able to reach another outcome with the insurer. Although these specific results aren’t recorded, those ‘other dispute outcomes’ might include:

• both parties agreed to a settlement amount

• the insurer offering a payment or compensation without necessarily admitting legal liability

• other benefits were offered to the person lodging the dispute, like their premiums being refunded or non-cash benefits.

It’s incredibly difficult to imagine pushing back against an insurer if you don’t get the result you were originally hoping for. But what this data shows is that being declined isn’t necessarily the end of the road. And by knowing what options are available outside of having a decision fully reversed, it’s possible to still end up with a positive outcome.

What can I do if I’ve been declined on a TPD claim?

Thankfully, as the national data shows, being declined is far from the end of the road. And even in cases where the decision can’t be reversed entirely, there are still very positive outcomes that can be achieved.

The team at Shine Lawyers have worked for over 50 years in helping Australians through some of their most challenging moments. We pride ourselves on thinking both inside and outside the box to secure the best legal outcomes possible. We’ll keep you informed and in charge, but do as much as we can so you can focus on your recovery.

And all that happens on a No Win No Fee* basis, so as we start this journey together, we’re not adding to your mental load.

If you’re ready to right wrong, chat to the experts in Super & Disability Insurance Law at Shine Lawyers today.