Question

Two definitions (‘any’ and ‘own’) are used to establish Total and Permanent Disability. Describe what is needed to establish a claim under each case and the type of clients that would be suited to each.

Answer 1

TPD cover is generally defined as insurance that pays out a lump sum if you become permanently disabled and are unable to work again. This general definition is further 'qualified' by your insurer, who will have their own definition of TPD. The end result? Often something similar to these three main definitions:

• Any occupation This pays a lump sum if you become permanently disabled and are unable to work in your own occupation or any occupation to which you are suited by education, training or experience.
• Own occupation. This pays a lump sum if you become permanently disabled and are unable to work in your own occupation. Because the terms are quite specific and a payout is more likely, this is the most expensive form of TPD insurance.