Imagine waking up tomorrow and not being able to work again. How prepared would you be?
Sure, workers compensation insurance will be able to protect you to an extent if you’re an employee and the injury happened at work. What if you’re self employed and have no workers compensation to fall back on? That’s where the likes of income protection insurance will kick in to ensure your income is supplemented up to 70%.

Then here comes the knight in shining armour, Total and Permanent Disability Insurance (TPD) which pays out a lump sum benefit if you’re unable to work again due to a severe illness or injury. So is it worth it? We say yes.

How does TPD Insurance Work?

Total and Permanent Disability (TPD) insurance provides financial protection if you become totally and permanently disabled and can no longer work due to illness or injury.

Here’s how it works:

Definition of TPD:

Insurers define TPD in various ways, but it generally means you are unable to work in your usual occupation or any occupation for which you are suited by education, training, or experience. This could be due to severe injury or illness, such as losing multiple limbs, blindness, or permanent paralysis.

Coverage:

TPD insurance offers a lump sum payment that can be used to cover living expenses, medical and rehabilitation costs, and debts like mortgages or credit cards. This helps ensure financial stability for you and your family during a challenging time.

Types of TPD Insurance:

There are typically two types:

Any Occupation: You are considered totally and permanently disabled if you cannot work in any occupation suited to your education, training, or experience.
Own Occupation: You are considered totally and permanently disabled if you cannot work in your specific occupation. This type is usually more expensive and may not be available through superannuation funds.

Why TPD Insurance is Crucial

TPD insurance is crucial in the event where you’re unable to return to work. A lump sum payout right when you’re at the most stressed period of your life, when your livelihood, your financial security and your future is treathened is an invaluable safety net to fall back on. It’s the security blanket that’s going to protect your finances from the burden of not being able to work again. Sure, income protection is great, but you’ll still need to come up with the other 30% of your income. What about medical expenses and medications, treatment plans, rehab? Those costs can quickly add up. Ensuring you have enough funds for your health, your mortgage, and your families way of life is exactly the reason why you need TPD in conjunction with your income protection insurance.

Things to consider when obtaining TPD

What if it’s not a permanent injury or sickness?

TPD insurance stands for total and permanent disability, meaning that it’ll pay out in the event where you’re unable to work again if you suffer a debilitating injury or sickness. If you suffer from an injury or illness that puts you out of work for an extended period, but doesn’t leave you permanently disabled, a Trauma insurance lump sum payout will likely respond in this event. Trauma insurance pays out a lump sum benefit if you suffer from event such as a severe injury, illness, cancer, heart attack or stroke.

Am I restricted on how I spend my payout?

One of the significant advantages of both TPD and trauma insurance is the flexibility in how you can use the payout. Once you receive the lump sum payment, there are no restrictions on how you spend the funds. This means you have complete control and can allocate the money in a way that best suits your needs and circumstances. Whether you choose to cover medical expenses, pay off your mortgage, make necessary home modifications, or simply ensure your family’s financial stability, the decision is entirely yours. This flexibility provides peace of mind, knowing that you can address the most pressing financial concerns without any limitations imposed by the insurance policy.

Is it worth the cost?

The cost of Total and Permanent Disability (TPD) insurance can vary widely based on several factors, including your age, gender, occupation, health status, and the amount of coverage you need. Your occupation is one of the biggest drivers of your insurance premiums. If you’re working a white collar, low risk, desk job, the likely hood of workplace incidents are significantly lower than those blue collar workers that are in construction for example that have dangers of pollutants, heavy lifting and physical demands, falling objects, and equipment and vehicle injuries. Those in lower risk industries will naturally pay lower premiums.

The Importance of knowing what you’re covered for

The policy conditions, definitions and exclusions are the backbone of any insurance policy.
When it comes to TPD (Total and Permanent Disability) insurance, grasping these terms is vital. They outline what constitutes a total and permanent disability. Since these criteria can differ between insurers, understanding them ensures you know exactly what is required to qualify for a payout. This is how Morgan Insurance helps as your advisor, so you know exactly what you’re covered for, and also can guide you through the claims process.

How to obtain TPD insurance

Comparing TPD (Total and Permanent Disability) insurance policies can be complex, but using a professional advisor like Morgan Insurance Advisors can simplify the process and ensure you get the best coverage for your needs. One of the key benefits of working with Morgan
Insurance Advisors is our access to a wide range of insurance providers. This means we can present you with multiple policy options, highlighting the pros and cons of each. This comprehensive comparison ensures you find a policy that offers the best coverage at competitive premiums.