Total and Permanent Disability Insurance (TPD) is usually part of a worker’s superannuation fund. But many workers don’t realise that if they also hold Income Protection Insurance they can usually claim benefits on both if they are ill or injured and cannot work. Some workers are also under the impression that if they are receiving an Income Protection Insurance payment that they can’t lodge a TPD claim, but they can.
If this is you, and you have sustained a serious injury or contracted a severe illness and cannot work, you are entitled to claim on both insurances. Let’s look at both types of insurance, and if you’re still unsure contact the TPD Helpline Australia today.
TPD Insurance
The definition of TPD varies, depending on your insurance policy, so this information is general in nature. In other words, each TPD policy is different so check the definition of TPD in your particular policy.
In general, benefits from your TPD Insurance are paid to you if you become ill or you are injured at work if:
- You must stop working as a result of your sickness or injury.
- You have not worked during the waiting period which is from three to six months.
- And after this time you cannot, or you are unlikely to be able to return to the kind of work that is within your range of experience, education, or training.
Depending on your insurance, your incapacity may also include work that you could be retrained to perform.
Income Protection Insurance
Salary continuance or income protection benefits are paid to you if you are injured or become ill. If your claim for Income Protection Insurance is successful, you will receive benefits if you are unable to work, even if it is due to a non-work-related illness or injury. Payments are made until you can go back to work, or until the benefit period ends, which is generally two or five years, or until you reach the ages of 60, 65 or 70.
The Benefits Available From Income Protection Insurance
Income Protection Insurance is meant to compensate and replace lost income based on your annual earnings in the 12 months before your illness or injury. If you cannot work because of a total or partial disability, your Income Protection Insurance will:
- In the first six months, pay you up to 90 per cent of your pre-tax income.
- After six months, you will receive up to 70 per cent of your pre-tax income for a specific time.
Every Income Protection Insurance policy will have a different definition of partial or total disability. Therefore, your disability must meet these before you can make a claim. Check your insurer’s PDS (product disclosure statement) for inclusions and definitions of disability.
Work-Related Injury or Illness
To make a claim for TPD or Income Protection, it’s important to reiterate that you don’t have to prove your illness or injury was work-related or caused by somebody’s negligence. For instance, should you be diagnosed with a condition affecting your mental health or you have cancer and cannot work, the majority of both policies allow you to claim benefits. Likewise, there is no need to prove employer negligence; all you have to prove is that you are unable to work due to your illness or injury.
The Benefits Available From TPD Insurance
TPD is a lump sum amount paid to you should you be considered by your insurer to be unable to work again or in some other kind of work. However, since all TPD insurance policies are different, benefits such as TPD Assist may be paid as a series of lump sum amounts each year, over the number of years you are unable to work. Some Superannuation funds offer lifetime pensions rather than lump sum payments.
TPD and Income Protection Claims and Loss of Your Job
Income Protection Insurance will rarely cover you for lost income due to losing your job, becoming unemployed or being stood down and made redundant. So make sure your policy makes it clear where you stand if you lose your job and become ill or injured and if there is a time limit between ceasing work and claiming. It’s crucial that you seek legal and insurance advice from the TPD Helpline or your lawyer before resigning from your job due to your disability, or even if you have already left work. TPD Helpline Australia helps people right across the nation to claim their superannuation TPD benefits. Even though they are eligible, too many Australians are not aware of their rights with regard to their TPD insurance claim benefits. Click here to contact us, phone 1300 679 222, or use the convenient online form to send a message.
