Applying the different definitions

POLICY definitions can be crucial in determining the value of an insurance policy. The following examples show the very different definitions applying to total and permanent disablement (TPD) insurance policies.

They also illustrate the two types of TPD cover, commonly called ANY occupation and OWN occupation.

The first policy definition is an example of ANY occupation and is very narrow. It states:

“For the first two years of a claim, you have to be not capable of doing the ‘Important duties’ of your regular occupation. After two years on claim, you have to be not capable of performing any occupation for which you are reasonably suited by education, training or experience.”

The second definition is an example of OWN occupation and is broader. It would be easier to lodge a successful claim in this case. It states:

“You must be unable to perform at least one of the income producing duties of your occupation. An income producing duty is one that generates 20 per cent or more of your income from work.”

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