Henry Carus + Associates | Injury Lawyers

What can I do if my insurance company has terminated my Income Protection Policy?

insurance companies terminate income

Income protection policies are designed to cover you in case of an injury, disability or illness so that you can maintain your daily expenses and focus on your recovery.

Depending on the type of policy you have, the definitions of an injury, illness or disability and the policy’s period of cover may vary. Insurance companies also have different methods of calculating your average weekly income.

The policy documents should be provided to you at the outset and it is important that they adequately reflect the coverage you were promised as such documents may later be used against you in the event your policy is terminated.

With that being said, it is also important to keep your policy in case the insurer has acted contrary to the policy in terminating your income protections policy.

We recently successfully settled one of our client’s income protection policy disputes with his insurer.


Our client purchased an income protection policy around 20 years ago for his ‘peace of mind’ in case something happened to him.

Unfortunately, in early 2011 he suffered from a heart-attack and has since not been able to return to his pre-injury duties in a full time capacity. His insurance company initially covered him for total disability for a period of time until he was able to return to part time duties. After his return to part time employment the insurer paid partial disability payments. The insurance company had been paying our client such payments for almost four years.

However, early last year his insurance company contacted him and interviewed him by telephone. A couple of weeks later the insurer sent our client a termination letter. Within that letter they referred to certain comments made by our client during the interview which they believed showed that he had capacity for ‘pre-injury full time employment’. It should be noted that no medical evidence was relied on and no attempts to contact his treating doctors were made. For a policy that covered ‘illness or disability’ this seemed strange.

Needless to say our client was extremely upset and stressed about the insurer’s decision to cease his partial disability payments. He felt very aggrieved and contacted our firm to seek our advice.

What we did

We advised him to leave copies of his policy documents and the termination letter with us and we would take it from there.

After some preliminary investigations we formed the view that the termination was not justified and swiftly commenced legal action against the insurer.

Throughout the litigation process we pressed the insurer for its entire file relating to our client’s claim. After reviewing the file we found numerous actions taken which were contrary to the policy.


At a recent mediation the insurer’s lawyers agreed that their client did not act in accordance with the policy and that our client’s payments under his policy should be reinstated.

Our client was reinstated and received back payments for the outstanding period as well as interest.

Contact Henry Carus + Associates

Other law firms may ask for upfront payment for such a complex policy issue, we have dealt with these cases on a no win no fee basis.

This can be particularly helpful for those who are unable to afford expensive litigation. Many individuals who are in the same position as our client often would not seek legal advice as litigation is expensive and it can often feel like a David v Goliath battle.

We are able to assist those individual whose policies have been unjustly rejected or terminated and we do so on a no win no fee basis.

If you feel your income protection policy has been unjustly terminated by your insurer please feel free to contact Henry Carus + Associates for a free consultation.