How much TPD insurance should I have?

Our life insurance calculator can help you work out how much total and permanent disability (TPD) insurance you may roughly need. For TPD insurance, select 'A lump sum payment if you are permanently unable to work again' and fill out the short questionnaire.

Try out TPD insurance calculator

So, how much TPD insurance do I need?

As with life insurance, determining how much TPD cover to take out requires a close look at your financial situation. You'll want to assess how your life, and those of your dependants, could be affected in the event of you becoming totally and permanently disabled.

A key first step in this process is writing down all of your current financial obligations.

10 common expenses TPD can help cover

Essentially, you'll want to work out what costs would be incurred if your income stream was suddenly removed. There are self-assessment calculators available online that can help with this process.

The next step to take is to calculate other sources of finances you'd have after you stop working. Do you have any savings or investments you could rely on? Would you get any other payouts, such as from an income protection policy? It's worth checking to see if you have any benefits within your super account too.

The difference between what you'd have and how much you'll need to fund your financial obligations and lifestyle can help to guide you in how much TPD insurance you may require.

When you're ready, compare TPD insurance quotes

Sort by:

Name	Product	Maximum Cover	Minimum Cover	Maximum Entry Age	Expiry Age	Stand Alone or Add on	hide
NobleOak TPD Insurance		$5,000,000	Not Stated	59	75	Add on		Get fully underwritten Total and Permanent Disability Insurance that can be customised to fit your occupational situation and financial circumstances.	Get Quote View details	Compare	loading Fetching your data...
Real TPD Insurance		$1,000,000	$50,000	59	65	Add on		Get a quote for up to $1 million in TPD cover.	Get Quote View details	Compare	loading Fetching your data...

loading

Compare up to 4 providers

Clear selection

Compare

Or speak with an expert broker about your needs

Enter your details and one of our partner brokers will call you. They will discuss your quote, options and available products.

First Name

Last Name

Phone

Email

State ACTNSWNTQLDSATASVICWA

Age

Sex

Male

Female

Do you smoke?

Yes

No

Level of Protection UnsureNone$100,000$200,000$300,000$400,000$500,000$600,000$700,000$800,000$900,000$1,000,000$1,250,000$1,500,000$1,750,000$2,000,000

An adviser can help you find cover from trusted life insurance brands.

• Get competitive quotes from multiple brands
• Lower rate of declined claims (according to ASIC)
• Save time and effort

---

If I already have life insurance, should I still consider TPD insurance cover?

It depends on what your existing policy offers in terms of TPD cover.

While standalone life cover can provide support in the event of the policyholder's death or diagnosis of a terminal illness, it won't always cover a policyholder who becomes permanently disabled. The impacts of suffering total disablement and not being able to work again can be devastating.

TPD insurance could help you keep on top of your current debt, living expenses into the future and any rehabilitation and ongoing treatment that they might require, the costs of which can run into many thousands of dollars.

Can I purchase TPD Insurance through life cover?

A number of life insurers do offer TPD as part of their life cover policies, but it's usually listed as an optional extra. This means you'd need to opt-in, by paying an added premium, in order to be covered.

It's important to review each Product Disclosure Statement (PDS) on any policy you compare before you lodge an application. Check whether a life cover benefit will be paid if there has already been a claim for TPD. In some instances, the benefit will not be paid or the policy will be cancelled.

To work around this, many policies will offer a 'buy-back' feature that reinstates the life cover that's been removed from the sum insured as the result of a TPD claim.

As an example, if you had $500,000 worth of life cover and $250,000 in TPD if a claim is made the life cover sum-insured would reduce to $250,000 in a linked policy. A buy-back feature will “top-up” this amount to $500,000 after 12 months of the claim being made.

The benefit of bundling the two cover types together is that it can be more cost-effective when it comes to paying premiums, and also makes the management of the two policies easier.

The main types of TPD cover to understand

TPD policies generally come under two definitions. These are "own occupation" and "any occupation".

Own occupation: Benefit is payable if a certified doctor deems that it is unlikely for the policyholder to ever return to the occupation in their field.

Any occupation: Benefit payable if the policyholder is unable to perform the duties of their regular occupation and is unable to work in any other occupation that they may be suited to by education, training or further experience.

The distinction in the way your TPD cover is set up is an important one. Financial adviser Brenton Tong told Finder that the type of TPD insurance that's sold within super funds, for example, was restricted to 'Any occupation'. The chances of having a successful claim in this type of policy were "dramatically reduced", as opposed to direct policies that offer 'Own occupation' terms.

"It's important that if you want full coverage for a broader range of events, you need to take out a fully underwritten TPD policy. Any policy that does the underwriting at claim or a later stage is opening you up to having your claim denied," Tong added.