Total and Permanent Disability insurance is a living insurance plan that pays a lump sum in the event that the policy holder suffers an injury or accident that is deemed total and permanent. TPD insurance payout can be used to cover hospital and medical bills, modifications to your car or home, rehabilitation costs, cost of a nurse or housekeeper and to provide ongoing financial support for your family.
Right from the onset, it is important that applicants remember that definitions and the scope of cover may differ from one provider to another. In light of this, it is wise to go through the product disclosure statement to get a clear understanding of when you will be covered.
TPD Claims Payout
It is essential that policy holders looking to apply for a TPD cover understand the process of making a claim in Australia. There are certain conditions that have to be met before a TPD insurance payout is made. It can take several months before a claim is paid out because the insurer must check to ensure that all conditions are satisfied.
When Can A Claim Be Made?
The first prerequisite is that the claim made must satisfy the definitions stipulated by the insurance regarding total and permanent disability. Generally, most policies will fall under "own occupation" or "any occupation". Under own occupation, a claim is paid out if the insured is disabled and cannot return to work in the position that they previously held before the injury or accident.
Under "any occupation" the disablement on the policy holder means that they are unable to ever work again in their field of expertise. Though not standard, most providers will require that the policy holder be incapacitated to perform tasks in their occupation for a period of at least 6 months. Some insurers will also have an age limit of 65 years.
TPD Claims Process
The claims process of a standalone policy is similar to that held within super, though there may be a slight difference. The first step should be to contact the claims team. They will give you the necessary claims forms so you can embark on filling them. If necessary, you can seek advice from a financial adviser. You also need to prepare the necessary documentation. The most essential documents are the completed claim forms and medical statements which should be signed by a certified medical practitioner. Bank details are also required so that benefits are deposited in your designated account. Some insurers may also ask for details of any previous claims.
Once the claim form has been submitted, it is assessed by the insurer. The insurer can accept, decline or defer the claim. When it is accepted, the claimant is contacted with the payment options. When it is declined, it means that the insurer has deemed that the claimant has not satisfied all the conditions that would necessitate the claim to be paid. When a claim is deferred, the claim is forwarded to a trustee who reviews it and makes a final decision on the status of the claim.
Kerrie Peacock is a skilled personal insurance scientist and you could gain from her comprehensive study. To find out more and ideas on just what can work for you, go to www.mecovered.com.au/tpd-insurance-payout.