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So, what should TPD be renamed?

The Association of British Insurers and its working party, the group handling the statement of best practice for critical illness cover, is calling for IFAs to help it find a new name for total permanent disability.

RGA head of claims Peter Barrett, a member of the working party, says the group is currently looking at new descriptions for TPD but says he is keen to hear what suggestions IFAs have.

He says: “What about IFAs? They have got to sit down and explain this stuff. We would like to hear their suggestions on a new name.

“At the moment peoples’ expectations are not being managed. We need a new name and we need a description that is clear. How can we describe the ‘T’ or the ‘P’ in a better way?”

In November the ABI said it is rebranding and standardising TPD due to the confusion around the phrase, but added further consultation was needed on the issue.

ABI assistant director of health and protection Nick Kirwan says: “The jury is still out on whether we have a collective name and if so what that might be.”

He says there is currently one candidate, but adds: “What we normally do is come up with three or four different suggestions which come at it from different angles and we will test them with consumers in March and April.

“We haven’t had any IFA input on new names so far but if anybody has any suggestions we would be happy to listen.”

Kirwan says the industry will have the opportunity to offer feedback formally when it consults on the TPD changes in May. He adds: “And I hope that IFAs will take part in that.”

A final consultation paper is due in June.

Lifesearch senior policy adviser Matt Morris says: “If the name is changed it’s something that needs to be carefully considered. After all, the problems with TPD are much more than just a name, it has poor claims rates, and that needs to be addressed first.”

Protection Review chief executive Kevin Carr says: “I’d drop the word total – a broken leg can be totally broken, but a claim won’t be paid just for that.

“So, permanent disability with an added phrase explaining you will not be able to work again, for example.”

Any more suggestions out there?

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Comments

There are 14 comments at the moment, we would love to hear your opinion too.

  1. Kevin is spot on. All agreed P&TD claims are due to ‘permanent’ disability but the word total is actually meaningless.

    Being permanently unable to follow your own occupation is not the same as been totally and permanently disabled. It might be, but it might not be.

    The same with ADLs, you could be permanently disabled and claim or permanently disabled and have a claim rejected because your disability is not extensive enough to meet the ADL requirements.

    There should be two definitions – Permanently disabled from following your own occupation and permanently disabled from meeting the requirements of a task/activity based definition.

    Forget ‘suited’ and ‘any’ as these are respectively pointless and too subjective.

  2. Thought you might be interested in this article.

    Cheers

  3. Basicallyfukkd ?

  4. Picking up on what Alan says – and I agree 100% with him, the obvious acronyms appear to be POD – for Permanent Own-Occupation Disability and PAD for Permanent Activity-based Disability. I prefer 3 letter acronyms to 4-letter ones!

  5. Firstly, what’s in a name ? Secondly, where should the cover be positioned?

    The name is fine. It;s more about how it is described and the customer proposition. TBD is a valuable benefit. However, it shouldn’t be offered as a catch all to CIC. It sits much better with IP. Why? Because it is disability cover.

    Then, it is down to the claims guys to pay genuine claims that meet the policy conditions. And don’t get me wound up (again) on the declinature debate, which is a complete red herring!!

  6. DFTND

    Dead From The Neck Down

    That was my opinion long ago, still is.

  7. Lets call it RDR!

  8. Its not the name, its the product.

    I look at some of the oversees insurance websites an see products like “Wellbeing Cover”.

    There has been no product innovation in the UK for years and its all very well re-inventing names but the product stays the same.

    Generally poor value and confusing definitions.

    Nick should know this he was with Scot Prov lomg enough.

  9. There is a place for permanent disability cover as long as it meets consumers reasonable expectations – in other words, it pays out when they have been led to expect it to.

    It does align with IP but is expressly designed to provide a lump sum rather than an income. Most plans are based around mortgage debt so this is not unreasonable.

    Simon is right in that a policy that fails to achieve the outcome that it’s designers suggested should be called an RDR.

  10. It’s true that TPD is a term that misleads consumers. To them, ‘disability’ means a physical incapacity of some sort.

    But why does there have to be a ‘universal’ name and a ‘universal’ benefit? Insurers should be making their products distinctive in terms of coverage and name, and finding ways of gaining competitive advantage.

    Another sign that innovation is dead and along with it meaningful competition (apart from on price, that is).

  11. There is a place for permanent disability cover as long as it meets consumers reasonable expectations – in other words, it pays out when they have been led to expect it to.

    It does align with IP but is expressly designed to provide a lump sum rather than an income. Most plans are based around mortgage debt so this is not unreasonable.

    Simon is right in that a policy that fails to achieve the outcome that it’s designers suggested should be called an RDR.

  12. Agree with Alan too.
    Alternative suggestions – Could call them permanent functional incapacity and permanent occupational incpacity.
    If that’s too much of a mouthful, just Permanenly incapacitated for the FAT/ADLs one and a plain English CYJA (Can’t do Your Job Anymore) for own occ.

  13. Prolonged Incapacity Cover

  14. Its been over 3 months since the ABI TPD Workshop and is this really as far as they have got??! When is the ABI going to get on and do something on this – they were given a clear enough brief…

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