The prospect of being unable to work or seek gainful employment because of a serious accident or illness is a daunting one for most of us. Many people in the community don’t realise that their employment super funds will probably include disability benefits. These benefits include total and permanent disability (TPD) lump sum payments and total and temporary disability (also known as income protection) payments.
TPD insurance provides a lump sum payout if you become totally and permanently disabled. This amount is designed to provide you with financial support if you can no longer work due to injury or illness and can be accessed to provide you and your dependents with money to live on.
Unlike other types of insurances, you don’t need to prove that the injury or illness was caused by someone else or is that it is work related. You’re normally eligible for a TPD lump sum payment if you can show that you’re not able to do your normal job or any other work relating to your training and experience. This doesn’t mean you’re unfit for all types of work – just the work that fits your skills, qualifications and experience. For example, if you suffered a neck injury that stops you from working in your normal job as an underground miner, you may still be eligible to make a TPD claim even if your doctor says you’re still fit for other light work such as an assistant in a hardware store.
A TPD payment will also be available in the event of terminal illness.
The fact that an injured person has received Worker’s Compensation benefits doesn’t generally impact on the ability to make a TPD claim but it really depends on the terms of the particular policy.
The “waiting period” for a TPD claim is the amount of time you need to prove that you have been absent from work as a result of your disability. In most cases, you need to prove that you have been absent from work for up to 6 months in a row as a result of your disability.
The amount of your lump sum payout will depend on how much cover you have and it is worthwhile reviewing your superannuation papers to check on the level of the available coverage.