Do you know the meaning of the term TPD in Insurance?

TPD is the short form for TOTALLY & PERMANENTLY DISABLED.


Still very technical and don't understand?


Well, that's why I'm here bringing out this BORING topic... (",)
Hope nobody falls asleep reading this post..


My aim is to make it clear, once and for all, in layman terms, so that ah pek, ah ma, uncle, auntie, brother, sister, and little boy, little girl also can understand..


A lot of time, we hear people saying:- INSURANCE CHEAT PEOPLE...


How true is that? We don't know and never bother to find out the facts and the true story behind. We just pity the "victims", and assumed that, YES, Insurance must be cheating someone, that's why someone is complaining and raising the issue with the media... And so, we stay away from it, as far as possible.. After all, it's better to be safe than sorry...


BUT, many a times, it is not that Insurance Companies cheat PEOPLE.. Insurance Companies operate under strict rules and regulations under supervision by BNM, and self regulated under LIAM and PIAM... And they all have to bide by the rules so that they do not lose their licences to operate. Everything is all in black and white, even IF the Insurance Companies were trying to cheat, they will be having a hard time finding ways... (I would say that it is almost impossible for them to cheat, at all.) 


Furthermore, how much is your premium? Will the companies be so STUPID in cheating our "less than RM100,000" premiums and risking their BRAND and GOODWILLS worth much more than that? No way, man....


Whereas, I have actually seen it with my bare eyes that people cheat Insurance Companies with the help of Insurance Agents, and Doctors... Well, I'm not going to share how they did it, because if their ways are perfect, they wouldn't have been caught already... 


Now, let me get back to the main topic today - TPD...


How is the word TPD defined in Insurance Policies? 
How can a person qualify under TPD?


I'm sure many are starting to scratch their head now... 
Let me ask you few simple questions..


1. Is losing one or two of your palm considered TPD?
2. Is losing an arm or a leg considered TPD?
3. Is losing eye sight of an eye qualify for 50% of TPD?


If you answer YES to above 3 questions, then you are like most of the people on the street...


Would you mind if I ask you to bring out your Insurance Policies from your drawer now?
Go, check it out, and read aloud what it wrote.
Look at the fine prints as well...


Having problems finding where is it located in your policies documents? 
You may email me at marvynchoong@hotmail.com. 
If you are from within Malaysia, you may try to make an appointment to meet me in Penang, I'll help you out personally.


Now, let me show you the actual BLACK and WHITE definition from Prudential policy document.

So, what do you understand from the above definition circled in RED?


Now, what does it mean lose by severance one limb each at or above his wrist and ankle, or two limbs at or above his wrist or ankle?


It means that the limb must be lose by severance. 


But, what is lose by severance? 
Mandarin translation is 失去遣散.


But, you understand the meaning?


In layman terms, that literally means the limb must be detached from your body.
If the limb is still attached to the body, but loss its functions, then it don't fall under clauses (iii) and (iv).


Now, go back to point (iii) and (iv) again, do you noticed that the lose of limb by severance must be above wrist or ankle?


That means that, if someone loss his palm, or feet, he is not qualify under clauses (iii) and (iv).


So, looking at clauses (ii), (iii) and (iv), it tells us that to qualify for TPD, the someone must either loses sight in both eyes, or loses sight on an eye plus loses by severance a limb above wrist or ankle, or loses by severance two limbs above wrist or ankle.

Understand now?

Let me illustrate with drawings although my drawing is not nice... (",)


Now, the writing means that TPD = loss of 2/6 Body parts by Severance.
Let say both eyes are labelled as [1], [2], and both limbs above wrist are labelled as [3], [4], and lastly, both limbs above ankle are labelled as [5], [6].

To qualify for TPD,
Clauses (ii) means part [1] and [2].
Clauses (iii) means part [3] and [4],
                         or part [5] and [6],
                         or part [3] and [5],
                         or part [4] and [6],
                         or part [3] and [6],
                         or part [4] and [5].
Clauses (iv) means part [1] and [3],
                         or part [1] and [4],
                         or part [1] and [5],
                         or part [1] and [6],

                         or part [2] and [3],

                         or part [2] and [4],

                         or part [2] and [5], 

                         or part [2] and [6],

Crystal Clear now?

GOOD.. I assumed you are ULTRA clear now with the drawing plus my descriptions...

Now, some of you might have noticed that I purposely leave out Clauses (i)... and start wondering why!!

Let me explain the meaning of Clauses (i) first.

Clauses (i) means that if a person do not qualify for Clauses (ii), or (iii) or (iv), there are still hope for you, because Clauses (i) is more lenient, and not so strict. As long as a person can prove that he is unable to engage in any occupation and is permanently and completely unable to perform any work for remuneration or profit, then it means the person is also considered TPD.

Happy with Clauses (i) ?

I love this Clauses (i) so much that I also look out for it in every policies that I can get my hands on...
Why? Why do I need to check on every policies?
Isn't it standardized in every policies sold out in Malaysia?

I also thought so... But to my horror and disappointment... I realised that some Insurance Companies do not include Clauses (i) in the TPD definition.

Please... do yourself a favour, can you please spend some time to look through your policies documents once more?

Is there Clauses (i)???

If there's none, there's two things you need to do.

Firstly, check with the Insurance Companies whether there's any amendments on this TPD clauses that included Clauses (i), but somehow they forgot to update you. If their reply to you is that the Clauses (i) is included, please get a black and white endorsement on the said clauses with your policy number clearly stated on it. Do not be fool into believing their sweet talk or whatever verbal explanations, because at the time of claims, everything will have to be based on the BLACK & WHITE stated in your policy documents.

Secondly, if the Clauses (i) is not included, then you might need to consider getting extra coverages from companies which offer such Clauses...

Feel free to comment and share me what you think.