MetLife did not breach its duty and obligations “in considering and declining” a total and permanent disablement (TPD) claim in August last year, the Supreme Court of New South Wales says in a ruling last month.

Justice Ashley Black also ruled the insurer did not breach any duty or obligations to Marie Hart in failing since November 15 last year to “reconsider” the claim for benefit payment she made under two group life insurance policies.

MetLife had applied to have a “first stage enquiry” after Ms Hart commenced court proceedings in March this year. She launched the proceedings after her request for a reconsideration of her claim was turned down. She had provided new document materials to support her claim but MetLife did not reconsider the claim.

Ms Hart, a former NSW police officer whose employment was terminated in July 2016 upon her official discharge, made the TPD claim under the two group policies in February 2018, saying she had been diagnosed with post-traumatic stress disorder (PTSD) in August 2014 and the following year by two different doctors.

On August 9 last year MetLife declined the TPD claim after providing procedural fairness some two months earlier in June.

Justice Black says in the ruling he is not persuaded that the absence of “specific reference to… documents impugns the adequacy of MetLife’s reasons, or its reasoning, or supports a finding of breach of the pleaded duties” on the part of the insurer. The documents include medical statements from the doctor who diagnosed her PTSD in 2014.

He ruled also that he is not persuaded that “any duty in respect of reopening applicable to superannuation trustees should be extended to insurers generally, or TPD insurers specifically”.

Moray & Agnew Lawyers, the law firm that acted for MetLife, says the court’s finding will significantly assist insurers in future claims in a number of areas.

One area relates to “duty to reconsider”, whereby the common law does not impose a duty on an insurer to reconsider a claim on receipt of further evidence.

“However consideration should always be given to whether the policy terms require a claim to be reconsidered,” the law firm says.

“Additionally a group life insurer may choose to reconsider a claim where requested by a trustee.”

The law firm says a separate “first stage enquiry” can be a useful and cost-effective process in litigation where the insurer is comfortable that it handled and assessed the claim in accordance with its duties.

Click here for the court ruling.