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A Comprehensive Guide to Physician Disability Insurance in 2021

No one ever plans to become injured to the point of disability, which is why disability insurance is so important. If you’re a physician, dentist, or another high-earning doctor, you know what it takes to become successful in the medical field. The last thing you want is to have the income you’ve worked so hard for threatened as a result of an unexpected disability.

Finding the right plan for you can be a bit of a challenge. Here’s what you need to know about physician disability insurance in 2021:

The Purpose of Physician Disability Insurance

According to the Social Security Administration, more than one in four American workers will become disabled before reaching retirement age. It’s wise to consider the following questions when shopping for disability insurance:

  • What would happen if you were suddenly unable to work?
  • What would be the result of losing your income for a year, two years, or permanently?
  • What if you could only take on half of your former workload? What if you could only work in a lower-compensated specialty as a result of an injury?
  • What would happen to your practice if you could no longer treat patients?
  • How would losing your level of income impact your finances? How would your lifestyle be impacted?

If you’re a doctor, you went through medical school, which means you likely have thousands to repay in student loans—this debt will not disappear if you are suddenly unable to work.

Physician disability insurance is designed to protect your income in the event of a devitalizing disability. In the event you are no longer able to work as you once did, your income should not suffer as long as you purchase the right plan for your situation.

Disability Insurance ≠ Workers’ Compensation

Disability insurance is pertinent because it protects your income even if you become incapacitated due to an injury or illness outside of work.

Workers’ compensation, on the other hand, will only protect your income if you sustain an injury or illness while performing the duties of your profession.

Group vs. Individual Policies

Group Policies

Your employer may provide a group disability insurance plan as a benefit of employment or you may purchase a group plan from the American Medical Association or the American Dental Association.

These types of plans are guaranteed issue, which means you’ll automatically be enrolled for coverage, just for applying.

Group plans often cost less than individual plans because they allow insurance companies to spread their risk across multiple individuals. You might pay a portion of the premium, but the majority is typically paid by the group sponsor.

However, a group plan may not be adequate for every physician. These plans only offer foundational benefits with limited optional coverage. If you have a very high income, you may not want to go with a group plan.

It’s also important to keep in mind that if you leave the group that provides the plan, then you will lose the coverage.

Individual Policies

There are no conditional limits on individual policies. As long as you pay the premium, you are covered. Typically, once you decide on coverages, the amount you pay stays the same unless you choose to opt-in for additional coverage.

It is common for physicians to supplement group coverage with an individual plan.

You may take your individual policy with you wherever you go. If you change jobs or drop your group policy, your individual plan remains intact.

You have many more carrier choices with individual plans. If you decide to add riders, you can purchase a fully-customized plan that suits all of your needs.

Keep in mind that the process takes about 4-6 weeks, so it may be wise to start shopping for coverage before you actually need it.

Short-Term vs. Long-Term Disability Insurance

Short-Term Disability Insurance

  • Covers temporary, non-threatening injuries and illnesses that you will likely recover from.
  • Benefits should start 14 days after you sustain a disability.
  • Benefits usually last six months but can last up to two years.
  • Benefits are often provided in six-month increments but can be up to two years.

Long-Term Disability Insurance

  • Covers serious injuries and illnesses that restrict or fully inhibit your ability to work for several months or years, or even for life.
  • Benefits may start after 30 days or as long as two years, depending on the elimination period you selected.
  • Benefits can last five to 10 years, or under certain circumstances, up to age 65.
  • Benefits are often provided through a group plan but an individual policy is often the best option.

How The Cost of Your Plan Is Determined

The following factors are taken into consideration when your rates are determined:

  • Age
    • Plans are more expensive the older you get.
  • Gender
    • Women often pay more for insurance policies because they:
      • Are more likely than men to suffer disabilities that affect their careers,
      • File claims more often than men; and
      • Their claims often remain open longer than men.
    • Women can save roughly 30-50% on disability insurance costs by finding a policy with unisex rates.
  • Health
    • You may be asked to submit an independent third-party paramedical exam.
  • Medical specialty
    • Your occupation classification will help determine your risk factor.
      • Classifications are numbered from one to six. The following items are considered:
        • Job-related hazards,
        • The level of difficulty in going back to work after a disability; and
        • The past claim experience related to your profession.
      • The higher the classification number, the less risk an insurer assumes for that profession.
      • The lower the risk, the lower the premium rate.
  • Financial underwriting
    • Since disability benefits are based on a fraction of your income, it is important for the insurance company to determine how much you earn.
    • The following will be assessed:
      • Earned income,
      • Unearned income,
      • Net worth; and
      • Your bankruptcy history, if necessary.
  • Location
    • The following are considered regarding your location:
      • State regulations,
      • Claims history in your region; and
      • Living costs and income levels.
  • Benefit length
    • The length of time that your policy’s benefits pay is your choice. The longer you receive benefits, the more you pay in premium.
  • Elimination period
    • This is the waiting period from the time your disability occurs to when you are paid benefits.

Disability Definitions

Any Occupation

Any occupation coverage does not provide benefits if you are able to work another job, even if it’s not closely related to your current profession.

This type of policy may not cost as much as other types of policies, but you also won’t receive the same quality of benefits.


Own-occupation coverage provides benefits if you are limited or fully unable to work the same job you had before the disability.

Disability Insurance Riders

Riders are options you can add-on to your policy to enhance your coverage. Doing so can help you personalize your plan to fit your specific needs.

To learn more about physician disability insurance riders, check out our blog post, “Should I Consider Any Doctor Disability Insurance Riders?”

If you have other unanswered questions about disability insurance for physicians, check out our “Physician Disability Insurance FAQs” page.

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 benefits.

Call Dabdoub Law Firm today at (800) 969-0488 to speak with an attorney about your case.