TPD: The Insurance You Didn't Know You Had.

Most working Australians have Total and Permanent Disability (TPD) insurance automatically included in their superannuation fund. It can pay a tax-free lump sum of tens or hundreds of thousands of dollars if you're permanently unable to work. Most eligible people never claim it — often because they simply don't know it's there.

What Is TPD Insurance?

TPD insurance pays a lump sum benefit if you suffer an injury or illness that leaves you totally and permanently disabled — meaning you are unlikely ever to return to work. The benefit is designed to help cover living expenses, medical costs, and mortgage or debt payments when your income stops permanently.

Unlike income protection (which pays ongoing monthly benefits while you recover), a TPD benefit is a single, once-off payment. Cover amounts vary by fund and member, but $100,000 to $500,000 is a common range for default super fund members.

How to Find Your TPD Cover

If you have had multiple jobs over the years, you may have multiple super accounts — each potentially with its own TPD cover. It is worth checking every account you have ever had, not just your current one.

The Two Policy Definitions — and Why They Matter

The most important thing to understand about TPD policies is that not all are equal. There are two main policy definitions, and the difference is significant:

• "Any occupation" definition: You must be unable to ever work in any occupation for which you are reasonably suited by education, training, or experience. This is the harder test — the insurer can argue you could work in some other, lower-skilled role even if you can't return to your actual career.
• "Own occupation" definition: You must be unable to return to your specific occupation at the time of injury. This is an easier test to meet, and claims are more straightforward. Own occupation cover is less common in default superannuation funds but may be available for additional premium.

Most default super fund TPD policies use the "any occupation" definition. This doesn't make them unclaimmable — it just means the evidence needs to be more comprehensive. Medical reports from treating specialists, vocational assessments, and work capacity assessments all play a role.

You Can Claim TPD Alongside Other Entitlements

A TPD claim is not exclusive. You can pursue a TPD claim at the same time as a WorkCover statutory or common law claim, a CTP claim, and Centrelink disability support pension. These are separate systems with separate entitlements. Receiving one does not automatically prevent you from claiming another, though there may be offsets in some circumstances that your lawyer can advise on.

How to Make a TPD Claim

The process generally involves: notifying your super fund that you wish to make a TPD claim; completing the fund's claim form (which includes sections completed by you, your employer, and your treating doctor); gathering supporting medical evidence; and submitting everything to the fund's insurer for assessment. Insurers often seek additional information or request independent medical examinations before making a decision.

Claims can take several months to assess. If your claim is denied, you have the right to internal review and external dispute resolution — and many initially declined claims are successfully overturned with legal assistance.

Tax on TPD Benefits

TPD benefits paid through superannuation may attract tax depending on your age and the components of the payment. Benefits paid before age 60 are generally partially taxable; after 60, they are typically tax-free. Your fund or a financial adviser can provide more specific guidance based on your circumstances.