What does TPD Insurance cover?
What’s the definition of TPD?
TPD cover, or total and permanent disablement insurance, pays out a lump sum payment if you’re permanently disabled and unable to work. How this is assessed will depend on what’s outlined in your policy.
Generally, the definition to be able to claim on this insurance is that you are totally and permanently disabled and it’s expected that you will never return to work again in your own occupation or any occupation.
There are different definitions for TPD cover which are important to consider when choosing your TPD insurance cover:
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The Any Occupation definition means that you have to be totally and permanently disabled and unlikely to work in any occupation for a six consecutive months.
This means that you would have to be unable to work in any occupation to be eligible to claim.
For example, if you are permanently disabled and unable to go back to your job on a work site, you may be able to work in an administrative role at head office instead. However, if you are unable to return to any type of work you may be eligible to claim on your cover.
The Own Occupation definition is specific means that you would be able to claim on the insurance if you were totally and permanently unable to work in your own occupation again; that is an occupation that you’re suited to by qualification, training or experience. This definition tends to be more expensive than the ‘any occupation’ option.
Activities of Daily Living
The definition of activities of daily living refers to things such as feeding, bathing, dressing and looking after yourself. If are unable to do two of these things in a situation where you are totally and permanently disabled, you may be able to make a claim on you TPD cover.
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