A total and permanent disability insurance cover will provide you with a lump sum payout once you are unable to continue working due to a disability. You will be able to access the benefits of your TPD insurance if you are able to satisfy the TPD definition laid out in your insurance policy. You may decide to take out your TPD insurance as a standalone policy, or you can bundle it with your life insurance policy.
There are various definitions under which you can take TPD insurance. The own occupation definition means that the benefits of TPD insurance can be paid out if you are permanently disabled, are unable to undertake the duties of your usual occupation for a period of six months and will not be able to work again in your usual occupation. Under the any occupation definition, you can access your TPD benefits if you are permanently disabled, you can no longer undertake the duties of your occupation for six months, and you are unable to perform the duties of any occupation for which you are suited to undertake either through education, experience or training.
The home duties definition for TPD insurance has been designed for people who carry out domestic duties full time and are unpaid. The duties that are recognized by most insurance policies include caring for the home, cleaning and cooking and looking after children that are dependent. Under this definition, you can access the benefits of TPD insurance if you are disabled and will never be able to perform your normal domestic duties or the duties of any other occupation.
Types Of Benefits
There are various TPD insurance benefits which are tailored to your individual needs. A partial disability benefit may be payable once you permanently lose the use of one arm, eye or leg. If you have a standalone policy, your beneficiaries may get a certain benefit payout on your death. The indexation benefit is when the sum insured is adjusted upwards every year to compensate you for inflation, and the rate with which the adjustment is made is as per the consumer price index.
You can have a guaranteed future insurability feature in your TPD insurance that will enable you to increase your policy coverage when you reach important milestones in life, like when you marry or acquire a mortgage. Due to this feature, you will be able to adjust your policy without having to go through a new medical exam.
If your TPD insurance has the feature known as loss of independence, this means your available TPD lump sum payment can be converted to a loss of independence payout, and so you will still be able to access the benefits of TPD insurance if you are unable to take care of yourself.
Uses Of Benefits
The benefits of TPD insurance can be used to pay for bills, school fees, rent or mortgage, and debts. They can also be used to settle your medical bills, costs of rehabilitation and specialized treatment. The disability may require that you modify your home or car, and you may even need to hire a permanent nurse or housekeeper. These expenses may be paid for by your TPD insurance payout.
Kerrie Peacock is an adept personal insurance researcher and you can benefit from her extensive research. For more information and tips on what can work for you, visit www.mecovered.com.au/benefits-of-tpd-insurance/.