Total and Permanent Disability (TPD) insurance is one of the most critical insurances to have in the event you are permanently disabled and deemed never able to return to work. TPD insurance provides a one off, lump sum payment to the life insured. At Pride Advice we want to make sure you are financial secure even in the difficult times
What is TPD insurance for?
Payouts are commonly used to:
Pay for home modifications and lifestyle changes.
Pay for long term care and ongoing medical expense.
Pay of any debts, such as a mortgage or personal loans.
Provide ongoing income to the household.
When should I get TPD insurance?
It’s wise to get TPD insurance when you’re young and healthy and can therefore potentially avoid medical checks and restrictions on the cover.
If you currently don’t have a mortgage, partner or kids, it doesn’t mean you shouldn’t consider life insurance now, as you may require it in the future.
Isn’t TPD insurance included in my super?
It can be, but you need to check and be sure that it matches your individual needs. Default TPD included with super can be very restrictive. In particular, definitions of “total and permanently disabled” vary significantly.
Another important variable is whether it covers you for ‘own occupation’ or ‘any occupation’. In this case, ‘own occupation’ refers to the specific job you held before your disability, and ‘any occupation’ refers to any job suited to your training, education or experience.
There are numerous variables to TPD insurance, and it’s difficult to be across all of them, let alone understand what’s best under your particular circumstances. Always seek advice from a financial and insurance expert when considering TPD cover.
It’s also worth noting that any insurance that is included in super can be cancelled under the Protecting Your Super Package if your account is deemed inactive (that is, no contributions have been made for 16 months).