While it may be a frightening thought, anyone can become disabled at any time, for virtually any reason. No one is immune from the possibility of debilitating disability, so it’s important to have a plan if the unthinkable should happen.
Having a plan may arguably be even more crucial for physicians than people in other occupations since these professionals spend so much money and so many years of their lives training to practice medicine.
If you’re a doctor shopping for disability insurance, there are certain elements you should be aware of before deciding on a plan.
Keep reading to have your questions about physician disability insurance answered.
Frequently Asked Questions About Physician Disability Insurance
How much does physician disability insurance cost?
The price you’ll pay for your plan will depend on several factors, such as the following:
- Whether you purchase an any-occupation or own-occupation plan
- Whether your policy is non-cancelable and guaranteed renewable, or if the insurance company can raise the premium or cancel your policy
- The financial strength ratings of the insurance company
- Your sex
- The quality of your health
Your specific occupation
- Policies that cover specialties with invasive procedures cost more
Optional benefits added to the plan
- Also referred to as insurance riders
You can expect the policy to cost anywhere from 1-4% of your annual gross income for a non-cancelable, guaranteed renewable policy. Keep in mind that you get what you pay for—cheaper does not mean better.
When is the best time to purchase a policy?
Since premium and policy eligibility are hinged on your age and health status, it’s best to purchase a disability insurance policy when you’re young and healthy. Pre-existing conditions are not usually covered and severe medical ailments may prevent you from obtaining coverage. This means the sooner you apply for coverage, the better off you’ll be.
What’s the difference between an individual disability policy and a group policy?
The following are characteristics of group long term disability insurance plans:
- Benefits are taxable if your employer pays the premium
Benefits are calculated on a percentage of base income
- Bonuses and commissions aren’t usually covered
- Benefits tend to be reduced during a period of disability if you collect benefits from another source or work in a different occupation
Definitions within the policy are more restrictive
- Benefits eligibility may require you to be unable to work in ANY occupation
- There are no rate guarantees
- Partial disability might not be covered
- The policy can be altered or eliminated by the insurance company or your employer at any given moment
- The policy is tied to the employer and typically not portable
The following are characteristics of individual disability insurance plans:
- If you pay the premium, your benefits are tax-free
- A quality plan will cover you in your own occupation or specialty
- The definitions within the policy are more liberal, which means you’ll receive more money in more claims scenarios
- The monthly benefits are higher
- The benefits may increase with inflation
- Your rate will be guaranteed until you reach age 65
- You own the policy, so you can take it with you to a new job or occupation
Why don’t group or association plans cost as much as individual policies?
Group and association plans are less costly because of the following:
- They can be altered or terminated by the insurance company
- The insurance company may raise the rates in the future
- Benefits are offset by other income and coverage sources
- Claims are paid in fewer scenarios because of the limited definition of disability
How can I compare various disability policies?
You can compare various disability policies using the following criteria:
- The language that determines what constitutes a disability, policy exclusions, renewability provisions, etc.
- The benefit period, elimination period, benefit amount, etc.
- Cost of living, residual benefit, future purchase benefit, etc.
- Insurance company financial strength ratings
Disability plans can vary widely from company to company, which makes it challenging to compare solely on price.
How do I decide on the right company for my needs?
It’s crucial that you find a strong, financially stable insurance company that will have the ability to pay your benefit if you need it. You can use insurance company ratings as a tool to evaluate the financial strength of an insurance company.
Where can I find insurance company ratings?
The best way to learn about rating information is to contact the rating service directly. You may also be able to find this information in books and magazines at your local library. If you’d like someone to gather the information for you, request the research from your insurance agent or financial planner. The following are some major rating services and their contact information:
A.M. Best Company
- (908) 439-2200
Standard & Poor’s Corporation
- (212) 438-2000
- (212) 908-0800
Moody’s Investors Service
- (212) 553-0377
Can I purchase coverage even if I have medical problems?
Gaining coverage will depend on the type and severity of your medical ailments. The insurance company has three choices:
- Charge a higher premium for the policy
- Exclude the condition from the policy
- Decline insurance altogether
What are some typical policy exclusions?
Typical policy exclusions include:
- Companies will sometimes limit benefits to two years
- War or act of war
- Normal pregnancy
- Active military duty
- Only in certain policies
- Medical exclusion
We’re Here for Your Support
If you need help applying for physician disability insurance benefits or your benefits have been denied, our team may be able to assist you. We have helped hundreds of people just like you obtain the benefits they needed, and we may be able to help you, too.
It’s the industry standard to deny insurance claims, so don’t be discouraged if your claim isn’t approved right away. All you may need is the help of an experienced attorney to receive the benefits you need.
Don’t hesitate to contact our office with any questions you may have right away.
Call Dabdoub Law Firm today at (800) 969-0488 to speak with an attorney about your case.