Total and Permanent Disablement (TPD) Insurance
Total and Permanent Disablement Insurance is only paid on a total and permanent disability. TPD is generally paid to the insured or the trustees of the insured by lump sum. Often TPD insurance is combined with life insurance.
However it is important to note that TPD insurance may be structured as “any occupation” or “own occupation” policy.
Under an “own occupation” definition the benefit under the policy will be payable where you are likely to be unable to ever again work at your own occupation, whereas under an “any occupation” definition the benefit will not be paid unless in the opinion of the insurers you are unlikely to ever be able to work again at you own occupation or any occupation that you are reasonably suited to by education, training or experience.
“Own occupation” offers a higher level of insurance cover than an “any occupation” definition cover and for this reason we generally recommend “own occupation cover” however once gain it depends on your individual situation.
TPD insurance may be held through superannuation however care needs to be excercised when holding TPD cover through superannuation.