Total & Permanent Disablement (TPD) Cover
Financial security if you can never work again
TPD insurance pays a lump sum if injury or illness leaves you permanently unable to work. It's designed to help you adapt to a new lifestyle, pay off debts, modify your home, and maintain financial security when returning to work isn't possible.
DBI LTD, Financial Adviser (FSP 1007984), operating under AIA Thrive Limited (FSP 665291).
Key Facts
What is TPD Insurance?
TPD insurance provides a one-time, tax-free lump sum if you become totally and permanently disabled, meaning you're unlikely to ever return to work in an occupation suited to your education, training, or experience.
Common causes of TPD claims:
- Severe back or neck injuries
- Major brain injuries
- Progressive diseases (MS, Parkinson's)
- Severe mental health conditions
- Spinal cord injuries
- Loss of limbs or eyesight
- Chronic pain conditions
- Degenerative diseases
Important note: Unlike income protection (which pays monthly), TPD pays once and helps you restructure your life permanently.
Why You Need TPD Insurance
If you couldn't work again, you'd need money for:
Real scenario:
A 45-year-old builder suffers a severe back injury. He'll never work in trades again.
With $500,000 TPD insurance:
- Pays off $350k mortgage
- $100k for home modifications and medical equipment
- $50k buffer for retraining and transition
Without TPD insurance:
- Forced to sell home
- Depletes retirement savings
- Family lifestyle drastically reduced
TPD vs Other Insurance Types
Many people bundle TPD with life insurance for cost savings. TPD cover works alongside life, trauma, and income protection to provide long-term financial security if returning to work is not possible.
How TPD Insurance Works in New Zealand
TPD insurance pays out when a medical specialist confirms that you are unlikely to ever return to a suitable occupation. It is designed for long-term, permanent conditions rather than temporary disability.
We make it simple by comparing our range of insurance providers and helping you every step of the way.
How it works:
- Choose cover type: Own Occupation or Any Occupation
- Apply and complete underwriting (health, occupation, lifestyle assessment)
- If an illness or injury leads to permanent disablement, your claim is assessed by medical specialists
- Once approved, you receive your lump sum payment (typically within 3-6 months)
- The money is yours and can be used however you wish: pay off the mortgage, get treatment, home modification, or long-term financial support
TPD is often bundled with life insurance for cost efficiency and claims flexibility. When structured as a 'Life Buy-Back,' it can significantly reduce your overall premiums while maintaining comprehensive protection.
Two Policy Options: Own Occupation vs Any Occupation
Own Occupation TPD
Pays if you can't do YOUR specific job
Own Occupation TPD provides a payout if you're unable to perform the duties of your specific occupation, even if you could theoretically do other types of work.
Example:
A surgeon develops hand tremors and can no longer perform surgery. Even though they could work in consulting or teaching, Own Occupation TPD would pay out because they can't do their specific job.
Best suited for:
- →Specialists and professionals (surgeons, dentists, pilots)
- →Tradespeople with specific skills (electricians, plumbers, builders)
- →High-skill physical roles
- →Anyone whose occupation requires specialized training
Key considerations:
- •More expensive than Any Occupation
- •Easier to claim (only need to prove you can't do your job)
- •Better protection for specialized careers
- •Pays even if you could work in another field
Any Occupation TPD
Pays only if you can't do ANY job suited to your skills
Any Occupation TPD only pays if you're unable to work in any occupation that you're reasonably suited for, based on your education, training, or experience.
Example:
A surgeon develops hand tremors and can no longer perform surgery. However, they could work in medical consulting or hospital administration. Any Occupation TPD would NOT pay out because they can still work in medicine-related roles.
Best suited for:
- →Office workers and administrative roles
- →Flexible professions
- →Those wanting lower premiums
- →Jobs that can be adapted or done remotely
Key considerations:
- •Cheaper than Own Occupation
- •Harder to claim (must prove you can't do ANY suitable work)
- •Less protection but more affordable
- •May not pay if you can transition to another role
Which to choose?
It comes down to your occupation and level of specialisation.
Specialists, tradespeople, and high-skill physical workers → Own Occupation (better protection)
Office workers, flexible roles, or budget-conscious buyers → Any Occupation (lower cost)
We'll explain the differences and help you decide based on your specific job and circumstances.
Who Needs TPD Insurance?
TPD insurance is valuable for most working New Zealanders, especially:
High-risk occupations
Trades, construction, manual labor, jobs where injury risk is higher and physical ability is essential.
Specialists and professionals
Surgeons, dentists, pilots, careers requiring specific skills that can't be easily transferred.
Anyone with a mortgage
TPD pays off your debt and ensures your family can keep their home if you can't work.
Self-employed or business owners
Your income depends entirely on your ability to work. TPD provides the financial buffer you need.
Young families
Protect your family's future and ensure they're financially secure if permanent disability occurs.
People approaching retirement
A sudden disability before retirement can devastate savings. TPD protects your retirement plans.
Additional TPD Features
Worldwide Cover
Whether you're at home, travelling or living overseas for any period, you remain insured.
Partial Permanent Disablement
Entitlement to receive financial support for partial disability. E.g. loss of sight in one eye. Lesser of 25% of the sum assured or $100,000.
Financial and Legal Advice
Support to access advice from an approved financial adviser or legal professional. Up to $2,500.
Frequently Asked Questions
What is Total and Permanent Disability insurance?
When does TPD insurance pay out?
What is the difference between Own Occupation and Any Occupation TPD?
Can I claim TPD if I can still work part time or in a different role?
Can I have both TPD and income protection?
Is TPD covered by ACC?
How long does a TPD claim take?
Does TPD insurance cover pre existing conditions?
TPD insurance definitions, premiums, and claim criteria vary by insurer and policy structure. We will help you navigate these factors and choose the right level of protection.
Have more questions?
Let's talkPlan for the unthinkable
Get a free quote and compare TPD policies from New Zealand's leading insurers. We'll help you understand Own vs Any Occupation options and find the right structure for your situation.