Disability Insurance

Total Permanent Disability

What is Total and Permanent Disability Insurance?

Total Permanent Disability (TPD) insurance provides a lump sum payment in the event of the insured becoming totally or permanently disabled.

Why do I need Total and Permanent Disability Insurance?

If the unthinkable were to happen to a main income source to the family, then this can put a major burden on the family. TPD can be used to the following:

  • Reduce or clear your home loan and other debts such as car loans
  • Cover medical and rehabilitation expenses
  • Meet your future living expenses
  • Provide for paid carers
  • Pay for accessibility modifications to your home or vehicle
  • Cover education costs for your children or grandchildren
  • Protect your long term wealth accumulation strategy

How can I pay for my Policy?

The benefit of TPD is that the yearly premium can be paid for out of your Superannuation. This is quite a favourable option as it doesn’t directly affect families instant cash flow.

Alternatively, Life Cover premiums can be paid in Monthly or Annual instalments direct from your bank account. Depending on the Insurance Provider.

Stepped vs. Level Premiums

Stepped Premiums gradually increase each year the policy is taken out. Levelled Premiums is where the price is locked in for a period of time.

Levelled Premiums generally have a higher initial cost but over the long term they can save money for the policy holder. Levelled Premiums are generally beneficial for the policy holder if taking the policy out for long term.

‘Any Occupation’ VS ‘Own Occupation’ definitions

When choosing your TPD Insurance, there are two definitions under which you will choose from when taking out your Premium, ‘Any Occupation’ or ‘Own Occupation’.

‘Any Occupation’ includes the advantage of a less expensive premium, this is because it is unlikely that you are to go back to work in your usual position, which is relevant to you through your past experience and training shown in your work history.

‘Own Occupation’ is when you are unlikely to go back into the workforce in your own particular occupation. This premium will work for you if you have a diverse occupation history, if you want a more flexible cover, and also if you are willing to pay a higher premium for these benefits.

Another advantage under the ‘Any Occupation’ preference, is that you can hold the premium under your superannuation fund. This is a more suitable choice if you have only ever worked in the one position/occupation for the whole of your work history and is also a good choice if you are thinking of choosing the less expensive option.

Upon choosing your TPD Insurance, it is paramount that you have considered the benefits of each definition, and are sure that the one you have selected with benefit you in the best possible way, as if an incident were to happen that possibly causes permanent disablement, this is the choice what will possibly effect whether or not you will be approved to receive the lump sum payout.


At Sheffield Financial Advisors we specialise in helping Australians get the best TPD Insurance cover for their personal circumstances & needs. As the appropriate cover amount & structure is different for every individual we provide tailored solutions and can advise whether enhanced definitions are available to you.

Talk to us to find out more about Disability Insurance and Get a Quote 

Sheffield Financial Advisors Pty Ltd. Authorised Representative Number 1253019. Corporate Authorised Representatives of Life Plan FP Pty Ltd | AFSL Number 449658