When you buy TPD insurance or income protection, you'll usually get to choose if you want own-occupation or any-occupation cover. The latter is cheaper because the chance of a successful payout is lower.
If you have an own-occupation policy, you will receive benefit payment(s) if you are unable to work in your usual occupation or profession (i.e. the job you have currently been working in). This means you will be able to claim even if you can work in a different field.
However, Any occupation will only cover you if you are unable to return to the workforce in any job/role that is suited to your education, training or experience. This is a much broader definition that's harder to prove, so you might have to return to work but in a different role.
For instance, if you were a surgeon, you might have to return to work as a GP if you were no longer able to perform your duties as a surgeon as a result of your injury or illness.
It depends on your occupation and financial position. For a good idea of which occupation type you should choose, consider the following:
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To compare these two types of cover against one another, check out the any-occupation vs own-occupation pros and cons.
| Pros | Cons | |
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| Own occupation |
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| Any occupation |
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Own-occupation cover provides you with the greatest opportunity to make a successful claim because the terms are far more specific. With own occupation, you don't need to prove you can't work, you just need to prove that you can't work in the job you were currently doing. It basically means it's far harder for insurers to dispute your claim, so it'll be accepted quicker.
Conversely, the terms for any-occupation cover are quite broad so an insurer could argue that there are suitable jobs that you could perform, some of which might bear little resemblance to your previous occupation. The upshot of this is that any-occupation cover is the cheaper form of cover as it's harder to make a successful claim for a disability.
Recent amendments to the tax act have made any-occupation cover preferable to own-occupation cover – at least for TPD insurance. This is because the new legislation has made TPD premiums tax deductible to the extent that they relate to a superannuation disability benefit.
TPD insurance and tax in Australia
This is defined as a benefit paid to a person because they suffer from ill health and have been certified as unlikely to ever be gainfully employed in a capacity for which they are reasonably qualified due to education, training or experience.
While most policies with any occupation cover have definitions quite similar to this, those with own-occupation cover are usually quite different, meaning that your TPD premiums won't be tax deductible.
No. You can no longer get own occupation inside super. This is mainly because insurance inside super is usually cheaper and less comprehensive. It's also often automatically included, and several occupations generally can't get own occupation because they're more high risk.
If you want own-occupation TPD insurance or income protection, you'll need to buy it separately.
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