Your Guide to Comparing TPD Insurance Quotes
When looking for TPD insurance to support yourself and your family in the event of total and permanent disablement, take some time to shop around.
Published November 17, 2021
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Comparing disability insurance quotes online can help ensure that you and your family are financially protected; should you be unable to work due to a sickness or accident. Gather TPD insurance quotes from Australia’s leading life insurance companies and compare the benefits and features provided by each company, while keeping in mind how much cover you need and what you can afford.
Use our step-by-step TPD insurance comparison guide to help you find the right policy to suit your personal requirements. This way you’ll be able to provide your family with the best when you aren’t able to work due to an accident or illness.
What is TPD insurance?
Total and Permanent Disablement (TPD) insurance provides a once-off lump sum benefit should you be unable to work because you’re totally and permanently disabled. TPD cover is designed to help you and your family pay medical expenses and outstanding debts, as well as provide financial support so you can modify your home to accommodate your new lifestyle.
How does TPD insurance work?
In exchange for paying a monthly or annual premium, you’ll be covered for sicknesses and injuries resulting in your total and permanent disablement that prevents you from ever working again, either in your Own or Any occupation depending on the disability definition you choose.
The Total and Permanent Disablement (TPD) insurance payout
You’ll generally receive either a full or partial TPD lump sum payout, depending on your level of disablement, which is determined by your policy terms and conditions as defined in the product disclosure statement.
Full TPD Payout
TPD insurance generally pays the full once-off lump sum benefit should you become totally and permanently disabled as per your policy definition of Own or Any occupation, or as per the definition listed in your policy docments.
Partial TPD Payout
Generally, a partial payment will be provided should you have suffered the total and irrecoverable loss of one of the below and are thus unable to work in your Own or Any occupation, or as per the definition listed in your policy documents.
- Sight in both eyes, or
- The use of two limbs, or
- The sight in one eye and the use of one limb.
How to compare TPD insurance quotes online
With Life Insurance Direct it’s easy to do a TPD insurance comparison to see premiums and features side-by-side from some of Australia’s leading insurers. All you need to do is fill in the quote form below. Alternatively, you could give us a call at 1300 135 205 and a specialist will help you find a TPD insurance policy that meets all of your requirements.
7 Things to consider before buying TPD cover
1. Choosing a TPD definition
When doing a TPD insurance comparison, there are generally 4 different definitions to choose from:
- Own occupation: The benefit is payable when you’re permanently unable to perform the duties of your own occupation.
- Any occupation: A lump sum is paid when you’re unable to work in any occupation for which your education, training or experience is reasonably suited to.
- Home duties: Pays a once-off benefit when you are totally and permanently disabled and can no longer return to your regular domestic duties, like cooking family meals.
- Modified TPD: A sickness or accident resulting in your inability to take care of yourself, meaning you can’t perform at least 2 of the 5 activities of daily living. For example, bathing and dressing.
Request assistance from a specialist to help you choose the right TPD definition for your requirements .
2. Stand-alone or linked policy options
You can choose to either buy a TPD policy on its own or combine your TPD cover with your life insurance or critical illness insurance. When linking policies, you’ll only pay one premium. However, when you claim on one cover type, the insured amount of the other types will generally reduce by the amount claimed.
3. Stepped vs level premiums
Make sure you know which premium structure you want when comparing quotes.
- Level premiums: Starts off more expensive, but is generally more affordable in the long-term because it does not increase due to your age.
- Stepped premiums: Cheaper at the start of your policy but increases every year.
- Hybrid premiums: Starts on a higher than normal stepped premium structure, but then converts to level premiums at a predetermined cost.
4. Built-in benefits and optional extras
The benefits and features included in your quote also plays an important role in the value each policy provides.
In the below example, both AIA and TAL pays a partial benefit in the event of losing one limb or one eye. However, AIA pays up to $750,000 for this benefit, whereas TAL only pays up to $500,000. On the other hand, both AIA and TAL provides the Life Insurance Buy Back option for an additional fee.
5. The waiting period
Another feature to consider when comparing TPD insurance policies is the minimum qualification period, which is the length of time an insurer requires you to be disabled before you can lodge a claim. Waiting periods differ from insurer to insurer, usually between 3 to 6 months.
6. Exclusions
Generally, TPD policies will not pay a claim when total and permanent disability is directly or indirectly the result of an intentionally self-inflicted injury. Every insurer has different underwriting guidelines, some with more exclusions than others. Be sure to carefully review the complete list of exclusions of the policy you’re considering by reading their product disclosure statement (PDS).
7. Premium price
Last, but not least, compare the cost of the disability cover you’re comparing. There’s no use in purchasing a policy with a long list of benefits and features if you’re not able to afford it in the long-term.
How are Total and Permanent Disablement premiums calculated?
The premium you’ll pay for your disability benefit is usually determined by the cover amount you want and various other factors, including your age, gender, occupation, smoking status, and the built-in benefits and optional features listed in your policy.
Frequently asked questions and answers
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What is double TPD insurance?
When you combine your life insurance policy with Double TPD cover, the Double TPD benefit allows you to reinstate your full life cover amount after the reduction of a full TPD claim being paid. -
Do I need TPD and income protection insurance?
Both TPD and Income protection provides financial support when you’re unable to work because of an accident or sickness. However, they differ in how they payout and for how long. TPD pays a once-off lump sum benefit when you’re generally unable to work in your Own or Any occupation. Income protection pays a monthly benefit, generally up to 75% of your regular income, for a benefit period of your choice; typically, 2 or 5 years or up to your age 65. -
Who needs TPD insurance?
If you or your family are reliant on your income to pay the bills and you do not have enough money saved for medical expenses and future living costs should you become totally and permanently disabled, then you probably need TPD cover. -
Which illnesses and disabilities are covered by TPD Insurance?
Any accidents and sicknesses that solely result in you being made totally and permanently disabled as per the policy definition will generally be covered. However, this depends on your insurer and the definition you’ve chosen. Total and permanent disablement generally constitutes a valid claim when you’ve suffered the loss of sight in both eyes, use of two limbs or sight in one eye and the use of one limb. -
What is partial TPD cover benefit?
A partial benefit is payable if you suffer a specific loss, for example, the loss of one limb or the loss of sight in one eye. -
Does TPD cover cancer?
Cancer is not usually listed as one of the illnesses covered by TPD, because many people are not deemed totally and permanently disabled when diagnosed with cancer. However, it is possible that you may become totally and permanently disabled as a result of cancer, therefore potentially becoming eligible for a payout.
If you want to be covered for cancer-specific diseases, you generally need to purchase trauma insurance. -
Is TPD tax deductible?
Total and permanent disability premiums are generally not tax deductible to policies personally owned, but some TPD policies purchased through super may be tax deductible to the fund.
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