Total and permanent disability, commonly known as TPD, is a type of insurance that provides a lump sum payment if you become injured or ill and you’re unable to work. Typically, TPD insurance can offer a financial safety net to those with a permanent disability.
In Australia, it is possible to receive both Salary Continuance (also known as Income Protection) and Total and Permanent Disability (TPD) benefits, but there are certain conditions and considerations to keep in mind. Income protection and TPD benefits are generally offered through superannuation funds or insurance policies.
If you need help navigating salary continuance benefits (income protection) and TPD insurance premiums, reach out to our financial adviser team at TPD Helpline today.
What is Salary Continuance/Income Protection Insurance?
Salary Continuance, also known as Income Protection insurance, provides you with a regular income stream if you are temporarily unable to work due to illness or injury.
If you are suddenly unable to work due to illness or injury, this insurance will pay you a percentage of your regular salary for a predetermined benefit period. This payment period is often up to two years or until you’re able to return to work, depending on the terms of the policy. This kind of coverage, known as income protection, acts as a safety net for your financial situation.
Income protection benefits ensure that your financial obligations are met, preserving your stability and quality of life during times of unexpected hardship. Understanding your income protection cover is essential for maintaining your financial well-being during challenging circumstances.
It’s important to note that there is usually a waiting period before the income protection benefits start, and it’s advisable to seek advice from a financial professional like our own at TPD Helpline to understand the specifics of your coverage.
The key differences between TPD insurance and income protection insurance are:
- Salary Continuance provides ongoing payments to replace a portion of your income when you are temporarily unable to work due to illness or injury.
- TPD provides a lump sum payment if you become totally and permanently disabled and are unable to work in any suitable occupation.
How Often Can I Receive Salary Continuance Payments?
The frequency of Salary Continuance payments can vary depending on the terms of your policy and the arrangements with your super fund. In most cases, these payments are made on a regular basis, such as weekly or monthly, similar to your normal paycheck.
The specific payment frequency will be outlined in your insurance policy documents and will dictate how often you receive your income protection benefit payment.
Am I Eligible For Income Protection Insurance Benefits And TPD?
To be eligible for Income Protection Insurance and total and permanent disability TPD Insurance coverage in Australia, certain criteria must be met. For Income Protection Insurance, typically, you should be an Australian resident aged between 18 and 60 with a stable income. You must provide accurate health and lifestyle information during the application process.
TPD eligibility requires being within a specific age range, often 15 to 65, and meeting the policy’s definition of “total and permanent disability.” The process might entail being unable to work in any occupation you’re suited for by education, training or experience.
Each income protection policy varies, so it’s crucial to carefully review and understand the terms, benefit period and requirements before applying for these valuable protections, including:
- Ongoing income protection entitlement: If you become totally and permanently disabled, you may be entitled to an ongoing income protection benefit. This benefit payment can help you replace your lost income and meet your living expenses.
- Lump sum benefit: In some cases, you may also be entitled to a lump sum benefit if you become totally and permanently disabled. This benefit can be used to pay for things like medical expenses, debt repayments, or home modifications.
- Income protection: Income protection insurance can provide you with an ongoing income if you become disabled and can’t work. These benefit payments can be helpful if your disability is temporary or long-term.
What Are The Income Protection Policies And Benefits?
Income Protection policies offer crucial financial support during illness or injury-related work incapacity. Income protection benefits vary based on your policy and generally include the following:
- Income Replacement: These policies usually cover around 75 percent of your pre-disability earnings, ensuring your monthly income is sustained.
- Benefit Period: Payments last a fixed amount of time, e.g., two years or until you return to work, with longer periods for extended coverage.
- Monthly Benefit: You receive monthly payments to replace your lost income.
- Waiting Periods: Payments start after a waiting period (days to months), affecting insurance premiums.
- Premium Options: Choose stepped (rise with age) or level premiums.
- Tax Deductibility: Premiums are often tax-deductible.
- Rehabilitation: Some offer help returning to work.
- Indexation: If your insurance policy is linked to inflation adjustment, lump sum payments and benefits can adjust.
- Extras: Options like redundancy or accident cover might be available.
Navigate Your TPD Insurance And Salary Continuance With TPD Helpline
Are you seeking income protection or TPD insurance benefits? Or unsure how to make a TPD claim? Connect with our team of financial experts and lawyers to guide you through your salary continuance benefits. Call us on 1300 679 222, email us at info@tpdhelpline.com.au or contact us via the enquiry form on our website. Contact us today.
