{"id":79386,"date":"2025-09-29T09:17:28","date_gmt":"2025-09-28T23:17:28","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=79386"},"modified":"2025-10-02T11:40:52","modified_gmt":"2025-10-02T01:40:52","slug":"tpd-payments-designed-for-life-gone-in-three-years","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2025\/09\/29\/tpd-payments-designed-for-life-gone-in-three-years\/","title":{"rendered":"TPD Payments Designed for Life, Gone in Three Years"},"content":{"rendered":"

Almost two-thirds of people who received a lump-sum TPD payment \u2013 that was designed to support them for life \u2013 spent it within three years. The finding was highlighted by Acenda\u2019s Partner Education Manager Marshall Ross<\/strong> during a company webinar.<\/p>\n

\u201cWhen it came to what they actually received as a lump sum, 63% of them exhausted their benefit within three years,\u201d he said.<\/p>\n

\u201cSo they had this benefit that was designed to compensate them for the loss of never earning an income again, and they’d used it in only three years.\u201d<\/p>\n

\"Marshall
Marshall Ross.<\/figcaption><\/figure>\n

Ross said about half of those holding a TPD product would have preferred an alternative to a single lump sum: \u201c\u2026something that was more episodic, or that was an income stream, was desirable compared to just a single lump sum payment”.<\/p>\n

Rising claims<\/strong><\/p>\n

Turning to claims, he said TPD claim volumes and sums insured rose between 2018 and 2024.<\/p>\n

\u201cOn average, payouts ranged from about $600,000 to just under a million dollars,\u201d he said.<\/p>\n

\u201cNow, if we go back to 2018 and compare that to the 2024 raw numbers of people with an individual TPD policy, the industry-level data shows it has decreased significantly over that period of time.<\/p>\n

…a reduced number of people in the pool are needing to fund that increased overall claim cost…<\/p><\/blockquote>\n

\u201cWe’ve got a decrease of the number of people in the pool, we’ve got a slightly higher claim rate, and those claims are being paid at a significantly higher average [dollar value].”<\/p>\n

He linked this trend to premium increases, \u201c\u2026a reduced number of people in the pool are needing to fund that increased overall claim cost\u201d.<\/p>\n

Current products<\/strong><\/p>\n

Looking at current product design, Ross urged advisers to focus on how they position disability cover.<\/p>\n

\u201cPeople need to understand what’s going to be right for them,\u201d he said. \u201cIt might be helpful to almost frame it around how this is dealt with between public sector and private [support].<\/p>\n

\u201cThe costs that come with disability will ultimately help them arrive at the right solution, the right mix when it comes to trade-offs as to what they’re going to privately fund and what they’re going to insure for, and what they’re going to leave, and rely on the public sector to support them.\u201d<\/p>\n

He added that even if products evolve, advisers should focus on making the most of today\u2019s offerings by framing cover around the specific problems it protects against, and the associated financial costs.<\/p>\n

\u201cA risk-based conversation around disability is always a great starting point, and that conversation has to flow off a needs-based conversation,\u201d he said.<\/p>\n

See: Mix and Match Option from Acenda<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Almost two-thirds of people who received a lump-sum TPD payment \u2013 that was designed to support them for life \u2013 spent it within three years. The finding was highlighted by Acenda\u2019s Partner Education Manager Marshall Ross during a company webinar. \u201cWhen it came to what they actually received as a lump sum, 63% of them […]<\/p>\n","protected":false},"author":23,"featured_media":79388,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8294,48],"tags":[],"class_list":{"0":"post-79386","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-claims","8":"category-company-news"},"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/79386","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/users\/23"}],"replies":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/comments?post=79386"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/79386\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media\/79388"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=79386"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=79386"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=79386"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}