For many of us, a serious workplace injury is one of the nightmare scenarios we dread most.
Not only are you trying to recover from an injury, but you’re also losing income while you do so. How do you support your family and pay your medical bills if you can no longer work?
TPD insurance can help pull you through difficult situations until you can start getting disability compensation. Read on to learn more about this type of insurance and how you can get covered.
What Is Total and Permanent Disability?
Before we dive into how total and permanent disability insurance works, let’s talk some about what TPD is. Total and Permanent Disability (TPD) means you are unable to work due to an injury or illness. Unlike some other forms of total disability, TPD refers to cases where you will never be able to recover enough to work again.
Many TPD injuries deal with the loss of use of limbs, including amputations or paralysis. In some cases, even if you can continue to work in another job, you may be awarded TPD if you can no longer continue to work in your current job. Other cases require you to be unable to work in any job suited to your education, training, and experience.
What Does TPD Insurance Cover?
TPD insurance is designed to help support you in the event that you become totally and permanently disabled. This is a lump sum payment designed to pay for medical and rehab costs while you wait on your income protection or other insurance benefits to kick in. It is not meant to be an ongoing source of income, but rather to support you and your family through the initial stages of your injury.
You’ll need to check with your insurer or super fund on what they consider TPD to be. Some more expensive policies will cover you if you become unable to work in the specific job you were working before the injury. Cheaper policies will only cover you if you are unable to work in any occupation you were trained for.
Who Needs TPD Insurance?
So when and why should you get TPD insurance? After all, no one expects to become totally and permanently disabled, right? But you don’t want to wait until disaster strikes to try and figure out how you’re going to support your family through your recovery period.
If you work in a riskier industry, especially one like manufacturing or construction, getting TPD insurance is a good idea. Take a look at what expenses you would need to cover if you were unable to continue working. This may include your living expenses, medical and rehab costs, retirement savings, and debt repayments.
TPD Insurance Riders
There are a couple of TPD insurance riders (adjustments) that you can get as add-ons to your basic coverage. The first of these is a presumptive total disability rider, an adjustment which may be built into some policies already. This rider covers you if you suffer the loss of your sight, hearing, speech, hands, or feet, since these are such traumatic losses.
You can also get a partial disability rider that helps to cover some of the gaps in your policy. Even if you get seriously injured and cannot work, your insurance company may not consider you totally and permanently disabled. This type of rider takes a closer look at how much your injury impacts your work and awards you benefits.
TPD Insurance Premiums
There are two kinds of premiums for TPD insurance that you can choose from: stepped and level. Stepped premiums get recalculated each time you renew your insurance policy. They usually go up each year, increasing along with your risk as you get older.
You can also get level insurance premiums that aren’t recalculated based on your age. There will still be increases, but they will happen more slowly over time. The trade-off is that level premiums tend to be higher at the start than stepped premiums do.
If you’re older and getting a new TPD insurance policy, stepped premiums may serve you well. But if you plan to keep your policy for a long time, level premiums could save you money over the years.
Picking the Right TPD Insurance Policy
When you’re shopping for TPD insurance, there are a few things you should look out for. First, you need to check if the policy covers “own occupation” or “any occupation.” This will tell you if the policy requires you to be unable to work in any job before the insurer will provide coverage.
You should also check on any exclusions your policy has and find the policy that works best for your work situation. There may be waiting periods before you can file a claim or limits on coverage, so check on those, too. And even if the premiums look like they’re low now, check on what they’re going to be in the future.
Applying for TPD Insurance
You can get TPD insurance from plenty of places. Of course, there are a number of insurance companies and brokers who provide TPD coverage, but you may also be able to get coverage through a financial adviser.
When you’re applying for TPD insurance, you’re going to need to give your insurer any information that might affect their decision about whether to cover you. Important factors could include your age, job, personal and family medical history, lifestyle risks, and any high-risk hobbies you have. They’ll want to know if you’re a skydiver with a family history of heart disease who smokes a pack a day.
Learn More About TPD Insurance
TPD insurance can be a great way to protect yourself and your family in case you’re ever injured. Make sure you check on the terms of your policy before you buy, and decide which premium type makes the most sense for you. Also be honest with your insurer about your personal history, as dishonesty could cost you a claim.
If you have been injured and you’d like help getting compensation for an accident, check out the rest of our website at Bourke Legal. We provide caring, expert assistance, and you don’t pay unless we win.
Contact us today to start getting all the compensation that is available to you.