What is Total and Permanent Disability (TPD)?

November 16, 2023

What is Total and Permanent Disability (TPD)? 

As TPD Lawyers, we are often surprised that people have almost zero understanding as to what TPD is. This is despite the fact that many people, unbeknown to them, actually have TPD policies of insurance that cover them! We have seen people who are seriously injured or sick (even catastrophic illness or injury) who don’t have the faintest idea that they have a TPD insurance policy – as well as a TPD claim! Here are some things you should know about TPD insurance claims:

1. You may have TPD insurance and not even know it

Many people who contact, or are referred to SK Legal have been injured at work, in a car, or as a result of negligence. Some have suffered life-changing illness. Surprisingly, most of them call to see whether they can claim compensation from someone else – but have not turned their mind to the fact that they may have a significant TPD claim.

However, many people are insured through their superannuation and they don’t even know it. They may not have even knowingly purchased insurance – but they have often been paying premiums from their Superannuation for years. Often the TPD insurance policies which they hold are for hundreds of thousands of dollars – and sometimes more. Further, some people may have also arranged insurance through a financial planner or insurance broker. Such professionals may have also set up a ‘retail’ TPD insurance policy on your behalf. This would often be done, for example, when/if you set up life insurance.

The bottom line is, if you’re injured or sick, and unable to work then you should consult a TPD lawyer who can assist you in working out whether you have TPD insurance – as well as assist you with any claim.

 

2. TPD covers both physical and mental illness or injury and the injury / illness does not need to be as a result of anyone’s negligence, nor occur as a result of work.
   Whilst policies differ with various definitions, generally, ‘Total Permanent Disability’ is determined on the basis of a person being unable to return to an occupation for which they were reasonably qualified. It is generally the case that it does not matter whether that incapacity arose out of a physical and/or mental injury / illness or any combination of these. Nevertheless, as policy definitions differ, you should contact a TPD Lawyer to discuss options you may have
   
3. Generally, TPD has little to do with ‘Fault’
   As Lawyers, we find that when many people who think of ‘compensation’ or ‘injury’ claims they think there must be ‘fault’ or ‘negligence’ on behalf of a party. That is sometimes the case. However, with a TPD claim, you do not need to prove that your illness or injury was anybody’s fault. You simply need to prove that your illness or injury has caused an incapacity for work to the extent that you are Totally and Permanently Disabled within the meaning of the policy. Sometimes you may have been injured as a result of someone’s negligence. If this is the case, you may have a negligence claim which can be made in addition to any TPD claim. You should certainly take advice from a Lawyer if this is the case.
   
   
4. Your occupation and qualifications matter
   With many policies, the entire question that needs to be determined in a TPD claim is whether you are fit to perform your work, or for many policies, ‘any’ work for which you are reasonably qualified. It is advisable to have a TPD Lawyer review the trust deeds and policies of insurance to determine your eligibility as well as the precise pre-conditions which need to be met. For instance, TPD definitions could include ‘Own’ or ‘Any’ occupation clauses. An ‘Any’ occupation TPD policy means that a claimant would need to be declared unfit to perform any occupation which may be suited to them by virtue of their education, training or experience. It is not enough to prove that you simply could not perform your own occupation. An ‘own’ occupation definition is far easier to satisfy as you would only need to prove that you are likely to be permanently unfit for your own occupation.What this means is that the last occupation you performed prior to your injury or illness is critical – as is your work history and other qualifications. For instance, it is generally easier to prove that someone who has engaged in manual labour all their life will be Totally and Permanently Disabled if they have suffered a significant physical injury than it would be for an office worker.