To have a successful TPD insurance claim, you must satisfy the TPD definition of your Total and Permanent Disability insurance policy. TPD policy terms and conditions vary between insurance providers and superannuation funds. However, one universal requirement is that you must have a severe injury or illness that stops you from working in your regular occupation, or (in most cases) one for which you have education, training or experience.
Most working Australians have TPD cover through their superannuation fund, but some have a stand-alone policy. Regardless of how you buy TPD insurance, a successful claim relies on understanding your policy’s definition of total and permanent disablement, including the difference between ‘Any Occupation’ and ‘Own Occupation policy’.
Free TPD Policy Investigation
Life insurance companies often make it challenging to claim a total disability benefit and receive a lump sum payout. These funds provide financial security, helping you pay rehabilitation costs, doctors’ fees, and other daily living expenses.
Thankfully, Aussie Injury Lawyers will investigate your TPD insurance claim for free (including your policy’s definition of total disability) and win your benefit on a 100% no win, no fee basis. Start now by Calling 1300 873 252
About the TPD Definition
Total and Permanent Disability, or TPD for short, indicates the degree of permanent disability that this insurance covers. When an insured person meets their policy’s definition of TPD, they can successfully claim financial compensation, which is paid as a lump sum into their super fund account (except for stand-alone policies)
The Meaning Behind TPD
When we talk about total and permanent disability, we refer to the inability to work due to injuries or illnesses that are expected to be permanent or long-lasting. Before making a claim, the medical condition must be deemed ‘fixed and stable,’ meaning no further improvement is expected (maximum medical improvement).
Examples of common conditions include:
- Severe physical impairments like reduced hearing or vision, loss of limb or major burns
- Terminal and critical illnesses like cancer, heart disease, arthritis and dementia
- Recognised mental health conditions like PTSD, severe depression, Bipolar disorder, etc.
Any Condition Could Make You TPD
For an insurance claim, the definition of Total and Permanent Disablement, is not the same as for claiming Centrelink benefits or NDIS entitlements. Any medical condition that stops you from working in your own occupation could qualify for a successful insurance payout.
However, due to the complexity involved in proving you have a permanent illness, injury, or psychological disorder, your best chance of winning a TPD payout is to work with an experienced lawyer specialising in TPD claims.
Variations in TPD Definitions Across Insurers
While the core concept of TPD cover remains the same, policy definitions vary significantly between life insurers. Terms like:
- ‘own occupation’
- ‘any occupation’
- ‘home duties’
- ‘activities of daily living’
When you are totally and permanently disabled, insurers use the terms of permanent disability insurance to define your eligibility for compensation. Hence, understanding the specific definitions of your insurance policy is crucial for a successful claim.
Understand ‘Own Occupation’ TPD Insurance
‘Own occupation’ TPD insurance pays a lump sum if the insured is totally and permanently disabled and unable to work in their specific occupation. Workers with highly specialised skills benefit most from this kind of policy since it covers them even if they cannot do their particular job, regardless of whether they can work in other roles.
However, be aware that ‘own occupation’ TPD cover is generally more expensive than other policies because it covers a broader range of circumstances for successful claims.
About Any Occupation Cover
Conversely, ‘any occupation’ TPD cover makes you eligible to claim insurance benefits when you are permanently disabled and cannot work in any job for which you are suited by education, training or experience. This is the only type of cover available through a superannuation fund.
What is the Difference Between ‘Own Occupation Cover’ and ‘Any Occupation’ TPD Policies?
| Type of TPD Insurance Policy | Features | Permanent Disability Benefit Terms |
| Own Occupation Cover | Costs more than any occupation cover and may not be available for high-risk professions | Generally, it is easier to claim a TPD benefit with the possibility of working again in a different occupation. |
| Any Occupation Policy | Typically available for a broader range of job roles and more affordable than own occupation cover | You are not eligible for a payout when you can work in a different role for which you are suited by education, training or experience. |
TPD Insurance Premiums: What to Expect
Several variables affect the cost of TPD insurance premiums, such as:
• The structure of the cover. i.e., whether it is stand-alone or linked to other life insurance policies.
• Lifestyle factors like smoking status and engaging in high-risk activities or hobbies, such as skydiving.
• The frequency of TPD premium payments.
Choosing Between Stepped and Level Premiums
There are two types of TPD premiums in Australia: stepped and level premiums.
- Stepped premiums increase at each policy renewal because the policyholder’s age increases the claim risk.
- Level premiums do not increase based on age, potentially offering a more cost-effective solution for people who maintain their policy over a long period.
Making a Successful TPD Insurance Claim
Making a successful TPD claim requires:
- A clear understanding of your TPD policy’s terms and conditions
- Compelling proof of a permanent inability to work in a suitable occupation due to illness or injury
- A correctly completed claim form supported by medical reports and professional evidence
The timeframe for TPD claim assessment usually ranges from 6 to 12 months, depending on the case’s complexity. However, you can reduce the time frame and increase the chance of success by hiring a specialist TPD lawyer on a 100% no-win, no-fee basis.
TPD Cover Through a Superannuation Fund
Most working Australians have TPD cover included within a super fund account. ‘Any occupation’ TPD policies are commonly included as default group insurance cover within superannuation funds but are often not customised for individual needs. While most superannuation funds offer default TPD insurance, which is generally less expensive than stand-alone policies, you should consider whether default cover sufficiently meets your needs.
Increasing TPD coverage within your super fund may be possible, offering a more cost-effective solution than purchasing directly from life insurers.
Claiming a TPD Benefit through a Super Fund
You can access TPD benefits from a super fund when:
- You’ve been unable to work due to injury or illness for over three months, with no expectation of returning to work.
- You may have TPD coverage through multiple super funds due to changing jobs, allowing you to make multiple TPD claims.
- The superannuation member statement indicates the insured benefit amount claimable from a TPD policy within a super fund.
NOTE: If you receive a lump sum payout at your preservation age, the withdrawn amount may be subject to income tax, which varies depending on age and the eligible service date of the superannuation.
More about tax on TPD payments >
Integrating TPD Insurance With Other Life Cover
TPD insurance can be purchased with other types of cover, such as life insurance, for more comprehensive protection. However, be aware that the life insurance amount may decrease when a TPD claim is paid out, potentially impacting the original life cover’s intended financial protection.
Bundling TPD insurance with life cover can save costs over purchasing separate standalone policies. A combined TPD and life insurance policy provides a lump sum payment upon permanent disability, helping to pay mortgage payments, personal debt, living expenses, and medical expenses.
Buy-back options may allow you to buy extra life cover after a TPD lump sum payment to top up the insured policy value, giving you a more significant life cover benefit.
More about life insurance payouts >
Choosing the Best TPD Policy for You
Choosing the best TPD policy can be a chore. You must consider your needs, lifestyle, budget, and family situation. To evaluate TPD policies and make an informed decision based on your situation and future financial needs, you can use comparison tools or speak with a financial advisor.
When buying TPD insurance, you must provide complete and accurate information about the following:
- your age
- employment
- medical and family history
- lifestyle
- any engagement in high-risk activities
Thankfully, most Aussies already have TPD cover and life insurance through a super fund.
Get Expert Legal Advice When Totally and Permanently Disabled
When you want to claim TPD insurance, Aussie Injury Lawyers will investigate your circumstances for free, including your policy’s definition of TPD. They will advise if you have an own occupation policy or any occupation, and your next steps to a successful insurance claim.
All our insurance claim legal services are funded on a 100% no win, no fee basis. Pay when you win and zero if you lose. It’s the AIL No Risk Guarantee. Start now by calling 1300 873 252, or use our free online claim check.
TPD Insurance Definition FAQs
What is the meaning of TPD in Australia?
TPD stands for total and permanent disability in Australia, a type of insurance often included in superannuation policies. When you are unable to work due to an injury or illness and meet your TPD policy terms for total disability, you can claim a lump sum payment.
What are the three standard definitions of TPD?
There are three broad definitions for Total Permanent Disability (TPD) insurance:
- any occupation
- own occupation
- activities of daily living.
These definitions determine if you qualify for a lump sum payout when you have a total and permanent disability.
What does TPD mean in disability insurance policies?
TPD in insurance stands for “Total and Permanent Disability.” It refers to a medical condition that prevents an insured person from working in their regular occupation because of an illness or injury. Consequently, they can claim a lump sum payout from the life insurance company.
How much does TPD insurance cost?
What you pay for TPD insurance depends on your occupation, age, lifestyle, and how much TPD cover you need. In most cases, the cost of insurance will increase as you age.
How is the cost of TPD insurance premiums calculated?
The cost of TPD insurance premiums is calculated based on factors such as age, gender, smoking status, overall health, and the type and amount of TPD coverage chosen. Together, these factors determine how much you pay in TPD premiums.
What is the difference between ‘own occupation’ and ‘any occupation’ TPD policies?
The main difference between ‘own occupation’ and ‘any occupation’ TPD policies is that:
• ‘Own occupation’ policies cover a disability that prevents you from working in your regular occupation;
• ‘Any occupation’ policies require proof of inability to work in any suitable job.
