A Target Market Determination, commonly called a TMD, is a document prepared by the issuer of a financial product that is subject to Australia’s Design and Distribution Obligations.

It describes the class of consumers for whom the product is likely to be appropriate, having regard to their likely objectives, financial situation and needs.

A TMD can also set out:

• Conditions or restrictions on distribution
• Information distributors must report to the issuer
• When the TMD must be reviewed
• Other matters relevant to monitoring how the product is distributed

What does a TMD not do? #

A TMD is not:

• Personal financial advice
• An individual assessment of whether a product is right for you
• A substitute for the policy wording or PDS
• A complete explanation of the insurance cover

The Design and Distribution Obligations apply to relevant retail product distribution conduct. Not every commercial insurance arrangement will therefore have a TMD.

Where a TMD applies, it will generally be available from the product issuer.