Total permanent disability insurance

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Total Permanent Disability (TPD) is a phrase used in the insurance industry and in law. Generally speaking, it means that because of a sickness or injury, a person is unable to work in their own or any occupation for which they are suited by training, education, or experience. An individual or group of individuals can insure themselves against it, often as part of a life insurance package, as worker's compensation, or separately.

Definitions of permanent disability

A permanent disability is one that "will remain with a person throughout" his or her lifetime, or he or she will not recover, or "that in all possibility, will continue indefinitely." <ref>Ballentine's law Dictionary, p. 402.</ref>

Insurance companies often have slightly different definitions of what determines permanent disability. However typical definitions would include:

• Loss of two of: eyes, arms or legs.
• Absence from work for six months due to an accident or illness, without expectation of returning to work.

United States

Under Worker's compensation law, each state and province has a definition of permanent disability.

Under No-fault insurance law, New York defines significant injury as including a permanent loss of use.<ref>New York Insurance law, section 5102 (McKinney's Laws).</ref>

Distinctions

TPD differs from income protection insurance in that the insured person must be permanently disabled for the insurer to pay out, rather than just absent from work for an extended period of time.