Disability Insurance for Doctors Tips
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Your Medical History Can Influence Your Ability to Get Disability Insurance for Doctors?
Your medical history may influence your ability to get physician disability insurance. Prior medical issues or lack thereof may also affect the rates you might be charged for doctor's disability insurance. You may qualify for the lowest available rates or be required to have a “rated” policy, with costs higher than you'd like. However, if you have less than a clean medical history, procuring a rated policy is still better than being deemed uninsurable.
Your practice and income are, over the long term, your most valuable asset. Just as you'd never neglect to insure your home, auto, etc., you should protect an asset even more important than those, with disability insurance for physicians. Regardless of your medical history, you should consider adding some features to your standard doctor disability insurance program.
- Residual disability coverage. Should you suffer a partial disability that causes you to lose 20% of your income or more, you may be eligible for benefits.
- Non-cancelable and guaranteed renewable. This helps protect your future insurability.
- Presumptive disability coverage. The loss of your sight, hearing, speech, or limbs may be covered disabilities, even if these conditions are only temporary.
- Waiver of premium. Eliminates the requirement to pay premiums during a covered disability.
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.
Learn the Different Types of “Disability” as Defined by Doctor Disability Insurance Coverage
Some areas of disability insurance, unlike life insurance for instance, can sometimes appear to be more gray than black or white. Defining disability, then determining whether it is covered or excluded from a doctor disability insurance policy, can vary a bit from insurance company to company. There is some consensus on three major categories of disability that you should know.
- Total disability. Physician disability insurance normally pays benefits if you have suffered an injury or sickness that causes you to be unable to perform most material duties of your regular occupation. Total disability can be further classified as temporary or permanent.
- Residual disability. Some doctor's disability insurance coverage allows for this category with varying definitions. Basically this term refers to partial, not total, disability and may be covered in some policies, using a rider or addendum. For example, assume you suffer injury or sickness that does not totally prevent you from generating income, but results in a 20%, 30%, etc. loss in earning ability. If you have purchased this coverage, you may still be eligible for benefit payments to help make up for your loss.
- Presumptive disability. Although there are some variations in definition, this provision generally states that, should you lose certain required abilities, you qualify for benefit payments. In general, should you lose your sight, hearing, speech, or two limbs, you may qualify for benefits under this type of disability. The loss of these abilities often need not be permanent, so even a temporary loss may make you eligible for benefits. For instance, assume you suffer an injury that takes away your sight temporarily or you severely break both arms or legs, making you unable to perform any of your duties for some period of time. If you have this coverage, you may be eligible for benefits.
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.
Where to Find Doctor Disability Insurance Company Financial Ratings
It is important to know that the company from which you purchase your disability insurance for doctors is financially stable to help ensure that they will be there for you should you need them. Learning about the financial condition of the companys' programs you might consider is fairly easy. There are a number of well-respected entities that provide ratings for many insurance companies. A few of the best are:
- A.M. Best Company
- Standard & Poor
- Moody's Investors Service
- Fitch, Inc.
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 Difference Between a Group Long Term Disability and an Individual Physician Disability Insurance Policy
There are some important differences between a typical group disability plan and a more comprehensive physician disability insurance policy. The most significant of which are noted below:
- Cost. A typical group disability policy is often less expensive than a doctors disability insurance plan. But, remember, you usually get what you pay for so the extra cost may not be an issue.
- Definition of disability. This potential difference can be very significant to you. A typical group disability policy considers a person no longer disabled if they can perform the duties of “any gainful occupation.” Individual medical doctors insurance can often include an “own-occupation” provision, which considers the insured to be disabled (and eligible for income benefits) as long as they are unable to resume the duties of their medical specialty.
- Taxability of benefits. Benefit income from a group disability policy that is paid for by an employer is normally taxable. Because most group insurance policies provide for a benefit level of around 60% of your gross monthly income, after taxation, your true benefit income will be around 45% or less. A doctor disability insurance program, that you purchase personally, normally provides that your benefit income is tax free. Therefore, even with an identical benefit income level (60%), you will generate 15% to 20% more real income with a physician disability insurance policy.
- Portability of insurance. If you leave your group and move to another position, your insurance ceases. By having your own disability insurance for doctors program, you can take your coverage with you wherever you decide to practice.
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.
Estimate What Good Doctor Disability Insurance Coverage Might Cost
Physician disability insurance is a critical component of your doctor's healthcare package of coverage. Estimating the cost of “good” coverage can be a bit challenging but here is a rule of thumb. If you budget from 1% to 4% of your gross income for the cost of appropriate doctor's disability insurance, you should be in the right ball park.
The final cost of your temporary disability insurance will be commonly influenced by the following factors:
- Using the standard definition of covered disability or the inclusion of an “own-occupation” provision, which provides benefits until you are able to resume the specific duties of your profession and specialty.
- The addition of other provisions that may provide additional coverage or lump sum benefits, such as residual disability or presumptive disability coverage.
- Adding business overhead expense coverage if you own your practice or are a partner in one.
- Your personal medical history. You may enjoy premium pricing or be subject to a “rated” premium based on your personal health record.
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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| Barbara Gibson |
