Own Occupation Disability Insurance Tips
Read these 7 Own Occupation Disability Insurance Tips tips to make your life smarter, better, faster and wiser. Each tip is approved by our Editors and created by expert writers so great we call them Gurus. LifeTips is the place to go when you need to know about Disability Insurance tips and hundreds of other topics.
Know What “Own Occupation” Means
You'll not be surprised to learn that disability insurance has an extensive glossary of terms you may not immediately comprehend. Most insurance policies are often based on a specific universe of terms that relate to the coverage offered. None are more important than "own occupation" coverage.
This provision in a disability insurance income policy specifies the conditions under which a disability is present and the own occupation period over which benefits will be paid. Unlike many basic and government disability insurance policies, coverage that includes an own occupation definition will normally qualify you to continue to receive monthly income benefits until you are able to perform the specific duties of your specialty.
This means that, unlike basic disability coverage, which often specifies that benefits end when you are able to perform the duties of any gainful occupation, having an own occupation rider or language normally keeps you eligible for benefits until you can return to practicing your specialty. Obviously, this affords you a much higher level of protection. As a professional, this is a level of protection that you should have, if at all possible.
As you can see, this term and definition of covered disability is a most important feature of income insurance protection. Be sure to examine the specific language of an own occupation provision or rider offered by your insurer. Even commonly accepted definitions of own occupation insurance may have a variety of modifiers and or enhancers in different insurance contracts. Use excellent websites, like ProtectYourIncome.com, to get more information to assist you in making the best disability insurance decisions for you.
The above-listed tip is for informational use only. Refer to your insurance policy contract for specific information regarding your coverage and for actual terms, conditions and exclusions. The above statements are general in nature and may or may not reflect the actual terms of your insurance policy.
Understanding an Own Occupation Rider to a Disability Insurance Policy
All insurance policies of any type include a large volume of standard (boiler plate) and specific language that outlines the type and extent of coverage, what conditions must occur to qualify for said coverage, any exclusions, and all other relevant provisions of the protection provided by that policy.
Additional coverage can sometimes be added to an existing insurance policy through the use of a rider, which is “attached” to a currently in force policy. In return for this additional protection, a premium for this extra insurance is payable.
Under some conditions, if you have group or individual disability insurance coverage with basic “any occupation” language and you want to further protect yourself, you may be able to add an own occupation rider to your policy. If allowed by your insurance carrier, this method of getting own occupation coverage, without reissuing one or more policies, may be a wonderful, more cost effective way to get the income protection you need.
By increasing your coverage using an own occupation rider, you solve one or more important issues at reasonable cost for maximum coverage. Remember this solution to added coverage may or may not be possible with your current or future coverage. But, if available, it is worth considering.
The above-listed tip is for informational use only. Refer to your insurance policy contract for specific information regarding your coverage and for actual terms, conditions and exclusions. The above statements are general in nature and may or may not reflect the actual terms of your insurance policy.
Tax Considerations of Own Occupation Disability Insurance Premiums and Benefits
You face a variety of income tax considerations with own occupation disability insurance as you would with all forms of this coverage. First, you should ask, “What does own occupation mean?” Own occupation coverage stipulates that, after suffering an injury or illness that qualifies as a covered disability, you are normally eligible to continue receiving benefits until you are able to resume the duties of your specialty.
If you have purchased disability insurance with an own occupation rider with your personal funds as an individual policy, your premiums are often tax deductible and your monthly income benefits are generally tax free. Conversely, if you are covered by a group disability policy or have coverage owned by and/or paid for by a business entity, your monthly disability income benefits are often subject to standard income taxes.
As with most income tax issues, there are few absolutes. For instance, is the “business entity” paying your own occupation disability insurance premium your own unincorporated company, all income and expenses of which included in your personal tax return? Are premiums paid by a limited liability company (LLC) of which you are the “member manager” and sole member? There are other potential tax questions that may need answers beyond the simple explanations of tax consequences noted above.
The best advice, as always, is that you consult your tax professional, preferably before you make your decisions about own occupation disability insurance. After learning of your options as they affect your income taxes, you'll have the information you need to make the best decision for you.
The above-listed tip is for informational use only. Refer to your insurance policy contract for specific information regarding your coverage and for actual terms, conditions and exclusions. The above statements are general in nature and may or may not reflect the actual terms of your insurance policy.
The Definition of “Own Occupation” Disability Insurance
You should always know the definition of disability language in an insurance policy that covers you. This language can be even more important if you are a medical or other professional. The basic definition of own occupation relates to the specific duties and responsibilities of your specialty.
In the context of disability insurance coverage, having an own occupation rider means you are normally considered to be disabled and eligible for continued benefits until you are able to resume the duties of your particular specialty, whether it is surgery, radiology, dentistry, ophthalmology, criminal law, or any other highly skilled profession.
Most group and government disability insurance coverage contains what are often called “any occupation” definitions of disability. If you are a skilled professional, this language might cost you a great deal of income in the future. As a professional, should you be covered with this language, you may become ineligible for continued monthly income benefits once you have recovered enough to perform the duties of any gainful occupation.
The choices of having no further benefits or taking a menial job until you fully recover to return to your professional duties are both normally unacceptable to most people. Therefore if you are in a highly specialized and compensated profession, consider adding own occupation disability coverage to your insurance package.
The above-listed tip is for informational use only. Refer to your insurance policy contract for specific information regarding your coverage and for actual terms, conditions and exclusions. The above statements are general in nature and may or may not reflect the actual terms of your insurance policy.
It's Important for Professionals to Have Own Occupation Disability Insurance
Although a wonderful option for many employed persons, own occupation disability insurance coverage can be extremely important, if not critical, to medical and other professionals. Most group, government, and some individual disability insurance coverage define a covered disability as the inability to perform the duties of your occupation. However, the language often provides that, once you are able to perform the duties of “any gainful occupation”, your eligibility for disability benefits has ended and monthly insurance income will cease.
In the universe of office workers, from junior employee to senior management, brick-and-mortar retailers, or e-commerce employees, this definition of disability is often not an issue. However, if you are a highly skilled medical or other professional, an own occupation definition of disability may be the difference between financial stability and crisis. Own occupation insurance means you will normally be considered to be disabled until you can return to the performance of your own specialty. Therefore, an own occupation period of benefits may be substantially longer than coverage that uses any occupation definition of disability.
Highly skilled and compensated professionals must take care not to risk their most important asset - their ability to generate substantial earnings both now and in the future. For these reasons, most experts consider own occupation disability insurance language to be of great importance to medical and other professionals.
The above-listed tip is for informational use only. Refer to your insurance policy contract for specific information regarding your coverage and for actual terms, conditions and exclusions. The above statements are general in nature and may or may not reflect the actual terms of your insurance policy.
Understanding Own Occupation Disability Insurance
Own occupation disability insurance can be very important to medical and other professionals. Most group disability and government disability coverage has what is often called an “any occupation” definition of disability. This language means that you can collect monthly income up to the time when you are able to perform the duties of any gainful occupation. Once you have the ability to perform any reasonable occupation, your insurer can determine that you are no longer disabled and are now ineligible for benefits.
Own occupation disability insurance coverage stipulates that, once you have been considered disabled per the language of your policy, you would remain eligible for benefits until you can resume the duties of your specific specialty. This different definition of disability can be immensely important to a professional with a rare and high level of expertise.
For example, assume the following conditions: You are an ophthalmologist, whose normal workday includes one or more delicate optical surgeries. You've suffered an injury to one or both of your hands. Your insurance carrier has certified you as disabled and eligible for disability income benefits. Five months from your date of disability, you've regained the general use of your hand(s) but you're still unable to perform precise, delicate surgery.
If your disability insurance coverage has an “any occupation” definition of disability, your insurance company may determine that you are able to perform the duties of any gainful occupation, though not your specialty, and declares you are no longer eligible for benefits. As you can see, it would be difficult, if not impossible to replicate your earnings as an ocular surgeon through a lesser occupation. If you have own occupation disability coverage, you would still qualify for monthly income benefits until you can resume the duties of your own specialty.
For this reason, medical and other highly specialized professionals should normally consider having own occupation language in a disability income insurance policy.
The above-listed tip is for informational use only. Refer to your insurance policy contract for specific information regarding your coverage and for actual terms, conditions and exclusions. The above statements are general in nature and may or may not reflect the actual terms of your insurance policy.
Effective Ways to Find the Best Own Occupation Disability Insurance
Navigating the sometimes cloudy waters of disability income insurance was a challenge some years ago. Unlike auto, fire, and life insurance, for which many sources always existed in large numbers; disability insurance was not nearly as popular a product. Therefore you had to search a bit to find the “best” available coverage. If you wanted the added protection of own occupation coverage, your task was made more daunting. This is no longer a problem.
The power of the Internet can help you find the best own occupation disability insurance available. You can even get help by using well-respected websites, like ProtectYourIncome.com, to act as your “virtual insurance advisor”. By maintaining and constantly updating their reservoir of insurance information and data on some of the best insurance companies and coverages, they will give you the knowledge to find the best own occupation disability insurance for you.
These wonderful website resources will help you differentiate between those offers that may appear to be the “best” and those that are actually the best for you. For example, finding disability insurance coverage providing the monthly income, waiting period, and length of benefits you want at a much lower cost than another, seemingly identical policy, may appear to make your decision easy. But, upon further examination, you may find that the lower cost coverage has an “any occupation” definition of disability.
Once you realize this and learn exactly what this provision means - that you are considered no longer disabled when you can perform the duties of any gainful occupation - you may reconsider your initial decision. As a highly skilled professional, you really want own occupation disability insurance coverage. You realize that own occupation insurance, which normally provides continuing monthly income benefits until you can perform the duties of your specialty, would be a much better choice than the lower cost policy you once favored. You might realize that this is the “best” disability insurance program for you.
These excellent websites, offering information, coverage suggestions, and referrals to top insurance providers, will allow you to find the “best” own occupation disability insurance coverage for your specific needs.
The above-listed tip is for informational use only. Refer to your insurance policy contract for specific information regarding your coverage and for actual terms, conditions and exclusions. The above statements are general in nature and may or may not reflect the actual terms of your insurance policy.
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