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Tips for Protecting Your Family's Future & Home

How are your finances post-pandemic?

Here are some suggestions you can focus on to bring more confidence back to your financial life

Rebuild your Emergency Savings Fund

If your home deposit or your pandemic response came from your savings, you may need additional protection while building them back up, so check your Income Protection insurance has a low claim waiting period.

Mortgage repayments are just the beginning of a spending budget

Be sure to plan ahead for repeating expenses such as council land rates & strata fees, utilities, and maintenance costs.

Lenders shy away from credit histories showing Pay-Day-Loans at refinance time

Should you ever need to refinance, banks consider a history of pay-day loans or credit card cash advances as a negative; so try not to use them in the 6 months before an application to refinance a mortgage.

If you can make additional loan repayments, do so

Most modern mortgages allow for additional repayments and many have an Offset Account so be sure to learn about these.


Have a goal of getting 3 months ahead in mortgage and loan repayments, then extend that to 6 months

Nothing feels as safe as being ahead in mortgage and debt repayments.

Three friends socialising, one seated in wheelchair

What is Total & Permanent Disability insurance?

A permanent injury or illness can make it difficult (or impossible) to return to work. TPD insurance can provide a long term financial safety net to help support you and your family, and pay for medical and rehabilitation costs.

TPD insurance pays a lump sum if you become totally and permanently disabled because of illness or injury and you cannot work in your usual occupation, or any other reasonably suited role because of a mental or physical disability, sickness or ill health.

  • It doesn't mean you cannot work at all; it just means you are unable to perform your job that fits your experience, skill and ability.

How does Total & Permanent Disability insurance work?

Each insurer has a slightly different definition of what it means to be totally and permanently disabled.

It can cover you for either:

  • Your own occupation — you're unable to work again in the job you were working in before your disability. This cover is more expensive and is usually only available outside super.
  • Any occupation — you're unable to ever work again in any job suited to your education, training or experience. This cover is a little cheaper but has a higher threshold to claim, so it's less likely to pay out.

The lower-grade TPD policies have a Modified TPD definition.  When provided by a super fund, this type of cover, rather than pay a lump sum upon a successful claim, are trying to introduce a yearly benefit payment (like an annuity) in an attempt to reduce lump sum payouts to claimants. We see many of these policies provided as default insurance cover inside an industry super fund. While the wording initially looks similar, the contract definitions, when you can find them, are restrictive and low-grade.

How would you recognise a lower-grade TPD policy? Sound confusing? It can be. That's why you need Sapience Financial.

Pro Tip: The higher quality cover can provide additional cover for Partial Total Disability claims and can make partial claim payments when needed.

Who should consider Total & Permanent Disability (TPD) insurance?

When deciding if you need TPD insurance, and how much, think about the expenses you'll need to cover if you were permanently disabled and unable to work.

  • living expenses for you and your family - food, rent (mortgage repayments) and healthcare
  • repaying debts such as a mortgage or credit cards
  • medical and rehabilitation costs
  • savings you want for retirement

Most people who take out Life insurance take out matching levels of Total & Permanent Disability (TPD) insurance.

Pro Tip: When thinking about what level of cover is right for you, make sure you understand the Numbers of Life (the statistical risks we all face and have to manage) and The Cost to Care (the approximate cost of treating major medical conditions and the expected out-of-pocket costs you may have to meet).

Frequently Asked Questions about Total & Permanent Disability insurance

What questions would an insurance company ask to those applying for a TPD policy?

An insurer will ask you questions when you apply for (or change) your insurance. These questions may be about your age, occupation, medical history, your family history (if known) such as a history of diseases, your smoking status, and about any high-risk sports or pastimes (such as competition BMX bike riding or skydiving).

If an insurer doesn't ask for your medical history, it may mean the policy has more exclusions or narrower policy definitions and may not provide the full cover available elsewhere in the market. That's why you need a Sapience Financial advisor to help you find the policy that's right for you.

What is the difference between Total & Permanent Disability Insurance and Income Protection insurance?

TPD insurance is designed to pay a 'single lump sum' payment upon a successful claim that can be used for major lifestyle modifications (or as needed). Income Protection insurance is designed to 'regularly replace a portion of your income' (and 100% of employer SG contributions) if you're unable to continue to earn an income.

  • A TPD policy has a waiting period of 6 months and compensates for the loss of long-term employment capacity.
  • Income Protection replaces a percentage of income each month till up to age 65, and the waiting period can be set as low as 14 days.

How do I make a claim on my Total & Permanent Disability policy?

If you have purchased your TPD policy through your Financial Advisor, your financial advisor will help you complete the claims process and walk you through the claims journey as your advocate. Beware legal firms and their marketing companies who would have you believe that every TPD claim needs a lawyer to be involved. If you meet a definition of a claim as disclosed in the insurance product disclosure statement (PDS), make a claim.

How we can help

TPD Insurance is a very important part of long term disability protection from the most serious of lifes risks helping you protect yourself, your family and your business.

Contact us for a confidential chat about your needs.

Related: Types of Personal Insurance products we work with

Different types of risk protection insurances, provide protection for different life risks.

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