Double TPD

Double TPD is another option available in a combined life and Total and Permanent Disability policy.

It allows for the reinstatement of your full life cover benefit following the payment of a total and permanent disablement claim.

How the Double TPD Options Works

Combined policies are often a great way to save on your premiums, however the downside is that a benefit paid out from one policy affects the other.

Unlike the Buy Back Option, Double TPD immediately reinstates your full life insurance benefit following a TPD claim.

In addition, all future premiums on the re-instated portion of life cover will be waived.

Case Study

Life InsuranceTPD InsurancePremium (monthly)
Initial Policy (pre claim)$500,000$400,000$43.48
Claim Paid($400,000)($400,000)-
Cover remaining post Claim$100,000-$15.00
Cover re-instated due to Double Buyback Option$400,000-Free
Cover Available after Double Buyback Option re-instated$500,000$0.00$15.00

Christine is a 45 year old Lawyer who decides to take out a Life Insurance Policy combined with TPD Insurance. She also decides to include the Double TPD option in her policy.

Several years after taking out her policy, Christine becomes sick and loses her ability to walk, becoming totally and permanently disabled.

Christine makes a claim and receives $400,000 benefit from her Total and Permanent Disability Insurance policy.

As her policy was combined, her Life Insurance benefit is reduced to $100,000, paying a reduced premium on the $100,000 benefit.

However, Christine is able to use the Double TPD option to immediately reinstate the $400,000 of life insurance.

Please note that Christine does not need to maintain the $100,000 portion of the cover she is paying for. She could cancel that portion and reduce her cover to the premium free $400,000.

Please note that this is an example only and is not indicative of actual circumstances, or premiums and cover available.

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Published: November 12, 2012
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