Compare Total and Permanent Disability (TPD) Insurance

TPD insurance provides a lump sum payment if you become totally and permanently disabled due to an illness or injury and cannot return to work.

Often TPD insurance is bundled together with life insurance, to ensure that you and your family are adequately covered in the event of your death or serious injury. However, it can also be purchased as a separate policy.

If you are permanently unable to return to work due to illness or injury, your TPD policy will pay out a predetermined sum that can help you to cover ongoing medical costs, debts, mortgage repayments, household bills and other expenses that can help protect the future lifestyle of yourself and your family.

TPD insurance can also be used to cover the costs of care, rehabilitation and home modifications required as you adjust to your new situation. To learn more about your TPD cover options from leading life insurers in Australia, get started with our comparison tool.

The amount of total and permanent disability (TPD) cover that you need depends on a variety of factors including your current income, future costs, your debts and your dependents.

What is your current income? Could your family cope without your income? Even if you don’t have an income, being permanently disabled can have a huge impact on the duties you can fulfill such as childcare, driving and cooking. Your TPD cover can assist in taking away the financial burden that you may face if you become permanently disabled.

If you have children, what does their future look like? Will you be able to afford to send them through school and university if you could no longer work?

Other considerations include your debts and mortgage repayments. If you rely on your income to pay these bills, will you still be able to pay them if you are unable to work?

Rehabilitation costs can be a huge financial burden if you are not expecting them. While your health insurance may cover some of these, it is worth comparing the cover to make sure you aren’t left out of pocket when you need it most.

Every insurer defines total and permanent disability differently and will have coverage for different situations. As such, it’s important that you understand what you are and aren’t covered for before taking out a policy.

Choosing the right type of TPD insurance is an important consideration. That is why at Lifebroker we compare policies based on a range of factors, not solely price. When you do a comparison you will have access to a range of product features, such as company size and claims paid, that can help you to make an informed and confident decision about your TPD cover.

Your TPD cover is a personal choice and it should help protect the lifestyle you currently lead, as well as the one that you want to protect in the future.

Each TPD product is different and it is important to read the relevant Product Disclosure Statement to ensure it’s the right product for you.

You can get started with our comparison tool or if you need further help comparing TPD cover, give our friendly insurance consultants a call on 13 54 33.

The TPD buy-back option is an added benefit that can be purchased under a TPD policy that is linked with your life insurance policy. After you have been paid a claim under your Total and Permanent Disablement policy, this gives you the option to buy back the amount that has been deducted from your life benefit. You have the option to exercise the TPD buy-back one year after your claim was paid.

While some companies include this option as standard, others will charge you extra for it, so it is important to talk to your Lifebroker consultant when comparing cover to understand your buy-back options if your policy is linked. Unlike trauma policies, there is no reinstatement option, meaning that you can only claim once per TPD policy.

If your TPD cover is stand-alone, any claim will not affect your life insurance cover, so you won't need to think about this option.

If you've done a bit of research into the options available for life insurance, you would have seen that TPD and trauma policies are available as linked or stand-alone policies. When you get a quote, you will find that one option is more expensive than the other, but why is this?

If you claim on stand-alone TPD or trauma, the other insurances are not affected by the payout. On the other hand, if you claim on a linked policy, the other insurances will reduce.

For example, if you had $500,000 of life insurance and $300,000 of linked TPD and you made a TPD claim, the life insurance would reduce to $200,000. If the TPD were a standalone policy, the amount of life insurance would remain at $500,000.

If you select a linked policy the premiums are lower. Stand-alone premiums are higher because you have the ability to claim and not have your other insurances affected.