Jackson claims she has been improperly denied full income protection and her entire disability cover from an insurance policy attached to her superannuation savings with major industry fund HESTA.
Kathy Jackson defended the allegations that were made against her in court.Vince Caligiuri
According to the Supreme Court of Victoria claim,Jackson became permanently disabled on August 29,2012 and was no longer able to work as a union official at the Health Services Union due to her disability.
Court documents state that on that date she became afflicted with post-traumatic stress disorder and major depressive disorder. Her insurance claim was supported by medical records and a psychiatrist’s report.
Jackson had a torrid experience towards the end of her time at the Health Services Union,which she left in 2015.
Two days before Jackson claims she was left too sick to work,the HSU took steps to remove her from her position,alleging Jackson broke the union’s registered rules covering gross misconduct,gross neglect of duty and substantial breach of the rules,and would seek to remove her from office.
Jackson hit out at the allegations at the time and has long denied any wrongdoing. Those allegations of union rule breaches followed at the union after Jackson had turned over two of her colleagues to the police for using members’ money and had.
In 2015, Jackson herself had misappropriated union funds and ordered her to pay more than $1 million in compensation. In 2020,she was sentenced to a wholly suspended jail term of two years for misusing union funds after to the charges.
According to her Supreme Court claim,before she became disabled,Jackson earned a salary of approximately $23,000 a month while working as the national state secretary of the HSU. The writ explains Jackson had topped up her income protection and total disability coverage during her employment at the union to ensure she had full coverage in the case of a disability that reflected the risk to her income.
Jackson alleges she sought to make a claim against her insurance for income protection in 2021,but was denied by the insurer AIA. The grounds for the denial AIA gave were pursuant to a clause in the Insurance Contracts Act that allows an insurer to avoid a payout “if the failure to comply with the duty of disclosure was fraudulent or the misrepresentation was made fraudulently”.
AIA only partially accepted Jackson’s claim for disability payment. It provided $128,937.78 to her based on her default cover,rather than for the higher coverage.
Jackson’s legal team at leading insurance claims firm claims she is still owed $838,098.57 under her income protection policy. Jackson’s claim asks that if the court does not find that she is entitled to the full amount,it could find that she was instead entitled to a further payment of $193,407.83 to reflect her topped up policy.
Jackson also alleges she was inappropriately denied $520,000 in total disability cover after being no longer able to work as a result of her mental illnesses. Jackson’s lawyers have asked the court that if it can’t find she was entitled to the full claim,it ought to provide her with at least the default cover for total disability,which in her case would be $114,000.
AIA and HESTA declined to comment.
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