When you stop working due to illness or injury, your ability to make a Total and Permanent Disability (TPD) claim will often depend on how your policy defines “total and permanent disablement.”
Two of the most important definitions used in TPD insurance are “own occupation” and “any occupation.” Understanding the difference between these terms is essential because it can determine whether your claim is accepted or rejected, and how difficult it will be to prove your entitlement. Also, some insurance policies provide an option to have your claim assessed under both of these definitions. These policies are usually called super-linked TPD policies.
Below, we explain how each definition works, what evidence is required to maximise the success of your claim, how super-linked TPD policies operate, and what to do if your claim is assessed under the wrong definition.
What is “own occupation” cover?
Under an own occupation definition, you are considered totally and permanently disabled if you are unlikely ever to return to your usual job or occupation. That is, the one you were doing at the time you became ill or injured and had to stop work.
This is the more generous and claimant-friendly definition because it focuses only on whether you can go back to your specific role or field, not whether you could do something else.
For example:
- If you were a carpenter who developed a serious back injury and can no longer perform heavy physical work, you may qualify under an own occupation definition, even if you could retrain into a lighter, office-based role or to teach in a school or TAFE using your existing skills.
- Similarly, if you were a pilot who loses medical certification, or a surgeon who develops a tremor, you may still qualify for TPD because you can no longer perform the essential duties of your original profession.
Importantly, since around 2015, own occupation insurance cover cannot be held in a super fund (unless it was already held prior to the change). This is because under the Australian super laws, an insurance policy can only be held inside super if the definition is consistent with a term of release (i.e., once a claim is approved, you can get access to the insurance benefits).
This rule exists because if you were successful in getting a super-based TPD benefit paid, it will be paid into your super account, and if you don’t satisfy a ground of release, it will be held in the super account until you retire or can get access. This means that the benefit will not be a huge help to you right now.
In summary, own occupation TPD claims are generally easier to satisfy.
What is “any occupation” cover?
Under an "any occupation" definition, you are considered totally and permanently disabled only if you are unlikely ever to work again in any job suited to your education, training, or experience.
This is the most common TPD definition used in superannuation funds and is generally harder to satisfy. A TPD benefit with this definition can be held inside your super account because the "any occupation" TPD definition is consistent with the permanent incapacity ground of early release from superannuation.
To qualify, it’s not enough to show you can’t do your old job. You must also show you can’t reasonably perform any other job you are suited to, taking into account your background, skills, and work history. However, when approaching these claims, the insurer must take into account the real-world prospects of you getting and keeping a job, despite your illness.
For example:
- If you were a truck driver with a knee injury, the insurer might argue that you could still work as a dispatcher, storeman, or forklift operator, if your injury allows (based on the fact that most truck drivers have transferable skills to do these roles).
- If you were a nurse who can’t perform clinical work, the insurer might say you could retrain as a health administrator or educator, if your illness allows.
Importantly, the insurer cannot just point to some other, low-paying, low-skilled job and say you can do this job and you cannot be paid a TPD benefit. Any work which you can return to must be similar to the work which you have done in the past.
Because this definition is stricter, many valid claims are rejected if the medical evidence only focuses on the fact that you cannot do your old job and says that you can do other roles, without giving genuine consideration to whether the proposed roles are suitable or sustainable.
Whether your policy definition is “own” or “any” occupation, medical evidence and doctor’s support are crucial to a claim. You can read more about this in our earlier blog, “The importance of your doctors for a successful TPD claim”.
What is a super-linked TPD policy, and how do they work?
A super-linked TPD policy is designed to combine the benefits of both worlds: the tax advantages of having your disability insurance inside super, while also allowing for a broader definition of disability (such as “own occupation”) held outside super.
Here’s how it works:
- The policy is split into two parts, one part held inside your super fund and another outside super.
- They’re issued by the same insurer, under a single policy structure, but are linked, and you only need to lodge one claim form.
- The super component meets the strict “any occupation” definition required by law, while the linked external policy allows for “own occupation” cover.
- If you claim, the insurer assesses the “any occupation” part first and, if not successful, automatically assesses the “own occupation” part.
- Importantly, you can only be paid the insured amount once, and you won’t be paid both the “any” and the “own” occupation TPD benefit. Many people think that they have twice as much insurance cover as they do because the insurance documents relevant to super-linked cover can be confusing.
- If you meet the easier “own occupation” definition, the benefit can still be paid through the external (non-super) component.
- It’s important to keep both parts of the policy active and paid up to date - if one lapses, the other may not operate properly.
These hybrid structures are common for professionals or higher-income earners who need stronger protection but still want the convenience of super-fund premium payments.
Also, it’s important to understand that the policies usually require that the insurer assess whether a claimant satisfies the any occupation TPD definition first and the own occupation TPD definition second. This can cause delays in the assessment of the claim because the insurer will usually refuse to assess both entitlements at the same time.
Are there differences in the tax payable on own v any occupation TPD benefits when super-linked?
Because the own occupation TPD part of the super-link policy is held outside super, you will be paid the benefit directly (rather than via super) if the claim is approved. This can have significant tax advantages for you compared to having the money paid into your super account and requiring you to apply to withdraw it early (and paying tax on the withdrawal, depending your circumstances)
It’s recommended that you get advice from a financial advisor or tax accountant regarding this.
Get help from a TPD lawyer
Understanding whether your TPD policy uses an own occupation or any occupation definition is critical to your claim. These terms determine how your eligibility is assessed and what medical evidence is required.
If you’re unsure which definition applies, or if your insurer says you could “do other work,” it’s worth getting advice.
Berrill & Watson’s superannuation and insurance team can review your policy, help you gather the right evidence, and manage your claim. We offer free initial advice, no upfront fees and run cases on a ‘no win, no fee’ basis.
Contacting Berrill & Watson
📞 Melbourne: 03 9448 8048
📞 Brisbane: 07 3013 4300
📞 Anywhere else in Australia: 03 9448 8048
How we charge
We are Australia's best-value superannuation/insurance law firm. Other law firms charge nearly double (& sometimes more than double) what we charge. So, if you get a quote from them, or have a cost agreement, ask us what we will charge you.