Disability Income

Whether you are in Emergency Medicine, Orthopedic Surgery, Anesthesiology, Cardiology, Radiology, Dermatology, Urology, Gastroenterology, General Surgery, OBGYN, Dentist, or other medical specialty, we can customize a own occupation disability insurance plan for you.

Most physicians have insurance coverage on their homes and autos. But if their future earnings cease because of an accident, injury or illness, the loss of income could present serious financial problems. Click for actual physician story.  A solution? An own occupation disability income insurance policy which protects a physician in his/her specialty.

We have been working with members of the medical community since 1993 and have a unique understanding of physicians' needs, rotations, schedules and preferences. We'll work with you to design an own occupation disability insurance plan specifically tailored to your unique situation. As an independent broker, we work with multiple insurance companies to create a physician disability insurance plan that is best suited for your specialty.

 

FAQ


HOW MUCH DOES DISABILITY INSURANCE COST?

The cost of the policy will depend on several factors including, age, occupation, health status, smoking status and gender.

 

WHAT ARE THE MAJOR DIFFERENCES BETWEEN INDIVIDUAL DISABILITY INCOME INSURANCE POLICY'S AND GROUP POLICY'S?

 

In general with individual disability insurance, the benefits are tax free if you pay the premium, higher monthly benefits, premium rate guarantees to age 65, the policy is owned by you and can be taken with you to a new job or state and generally more liberal definitions within the policy to pay you more money in more claims scenarios.In general with group disability insurance, benefits are taxable if your employer pays the premium, more restrictive definitions within the policy, policy can be changed or canceled at any time by the insurance company or your employer, no premium rate guarantees, people with poor health can get coverage, less expensive than individual coverage and no medical exam to qualify for benefits.

 

CAN I PURCHASE COVERAGE IF I HAVE A MEDICAL CONDITION?The type and severity of the medical problems will be evaluated by the underwriters at the insurance company. Generally, one of three things will happen. The insurance company can charge a higher premium for the policy, exclude the condition from the policy, or decline insurance altogether.

 

WHAT HAPPENS TO MY POLICY IF I CHANGE JOBS, MOVE TO ANOTHER STATE OR CHANGE OCCUPATIONS?If your policy is non-cancellable and guaranteed renewable, the policy benefits typically will not change. Additionally, individual disability insurance policies are portable, so you take them with you if you move to another state.

WHEN IS THE BEST TIME TO BUY A DISABILITY POLICY?Now. Because the best time to buy a disability policy is when you are young and healthy, and the premiums are based largely on health and age.

CAN I TAX DEDUCT MY DISABILITY INSURANCE PREMIUMS?

According to current IRS guidelines, if you deduct your disability insurance premiums, your benefit(if you become disabled) would be taxable. If you pay with after tax dollars, your disability insurance benefit is tax-free.

WHAT IF I LEAVE THE COUNTRY?

Depending on the policy, some policies will cover foreign travel. Other policies will suspend the contract while you are abroad. If you go on active military duty, most companies will put your policy in suspense until you are off of active duty. Check your policy for these important provisions.

CAN MY EMPLOYER PAY OR REIMBURSE MY PREMIUMS TO ME?

Your employer can pay for your disability insurance coverage, however it may cause the benefit to be taxable to you at the time of claim.

WHAT IS THE APPLICATION PROCESS?

Once you have made a decision on which policy you would like to apply for, we will either meet with you or call you to gather additional information and schedule a medical exam. The exam can be completed at your home or office at no cost to you. Once we receive all completed forms the application is then sent to the insurance company to go through underwriting.

WHAT IS UNDERWRITING?

Underwriting is the process by which an insurance company examines, accepts, or rejects insurance risks so as to charge the proper premium for the coverage. The company classifies the accepted applicants into different risk categories to charge the proper premium.

HOW LONG WILL UNDERWRITING TAKE TO GET COVERAGE?

The underwriting process generally takes anywhere from 30 to 90 days, before a decision is made.

WHAT IF I AM PREGNANT?Check the policy to see if complications of pregnancy are covered. Pregnancy can be covered under a disability insurance policy.

CAN I SEE MY OWN PHYSICIAN IF I BECOME DISABLED?

Yes. Most companies will allow you to see your own doctor if you are disabled. The insurance companies do reserve the right to have their own physicians evaluate you disability

WHAT ARE SOME COMMON EXCLUSIONS?

Mental/Nervous Disorder(reduced benefit period)
Act of war
Active Military Duty
Foreign Travel

WHERE DO I FIND INSURANCE COMPANY RATINGS?

A. M. Best Company
Ambest Road
Oldwick NJ 08858
Phone: (908) 439-2200
Internet: www.ambest.com

Standard & Poor's Corporation
55 Water Street
New York NY 10041
Phone: (212) 438-2000
Internet: www.standardpoor.com


Moody's Investors Service
99 Church Street
New York NY 10007
Phone: (212) 553-0377
Internet: www.moodys.com

Policy Features

DEFINITION OF TOTAL DISABILITY

It's important to know if the disability insurance plan's detailed definition of total disability protects you in your medical specialty or if it generally states your inability to work at any job. Only a comprehensive disability insurance policy that offers the "true" own occupation benefit will protect you in your medical specialty and replace your income, even if you are at work in another occupation.

NON CANCELLABLE AND GUARANTEED RENEWABLE

This benefit is imperative in all comprehensive disability insurance policy's. Non Cancelable and Guaranteed Renewable means the insurance company cannot terminate your policy, amend your policy provisions nor raise your premiums so long as you continue to pay your premiums. A comprehensive individual disability insurance policy will offer this benefit.  Many group, hospital and association plans DO NOT offer this vital benefit.

RESIDUAL DISABILITY BENEFIT

Not all disabilities are "total". You may suffer a partial (or residual) disability that limits your ability to work and results in a decrease in income. Under this important benefit, you are considered residually disabled if soley due to sickness or injury, your loss of income is at least 15 -20% (Percentage loss depends on policy contract) of your prior income, and you are gainfully employed. No specific loss of time or duties is required.

BENEFIT PERIOD

Most policies offer benefit periods to age 65, 67 or lifetime.

FUTURE INCREASE OPTION

You are able to increase your disability insurance monthly benefit, as your salary increases, without providing medical insurability. This is commonly referred to as Future Increase Option (FIO) or Future Purchase Option (FPO).

WAIVER OF PREMIUM

This assures that if you become disabled, your premiums will automatically be waived until you're no longer disabled.

INFLATION BENEFIT

This means your disability benefits may be increased to keep pace with inflation after a disability begins. This is commonly referred to as COLA (Cost Of Living Adjustment).


 

Buying Advice

Be more concerned with quality of a policy than price.

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The cost of a policy should not be the first consideration when it comes to disability insurance. You can expect to pay 1% to 4% of your income for a comprehensive individual disability insurance policy.

Make sure your policy is non-cancelable and guaranteed renewable.

 

This means the insurance company cannot cancel your policy, increase your premiums or change policy provisions if you keep paying premiums due. Group (hospital) or association plans typically do not offer this important benefit.

Always understand the definition of total disability.

 

This can mean the difference between getting paid and not getting paid.

 

Why you should be careful of group (hospital) plans?

 

Group disability insurance plans may be amended, changed or terminated at any time. This could leave you without coverage when you need it. Many group disability plans have a restrictive definition of disability. They require you to be totally disabled before they will pay a benefit. If you have the ability to do any type of work, benefits may not be payable or if you are working in another occupation, your benefits are reduced. Most group plan benefits are taxable. Many group plans can’t be taken with you if you should decide to switch employers.

Look at the insurance company financial ratings.

 

Your disability insurance company could potentially be paying your salary to age 65 or possible the rest of your life! It’s important they be financially sound. All disability insurance companies are rated by third party rating companies.

The 90 day waiting period is usually the most cost effective.

 

There is a substantial savings in choosing a 90 day waiting period over a 30 or 60 day period.

Make sure you request and read the specimen policy so that you understand all of the contractual provisions.

Marketing pamphlets are typically brief overviews of disability insurance policy benefits and can be often misunderstood.  They typically do not get in to the details of the actual policy and its provisions. Just because your medical association, group or hospital sponsors it, does not mean it is right for you or comprehensive. Request an illustration which will include policy details and premiums along with a specimen policy.

Establishing a relationship with an independent broker is an advantage.

 

A broker will represent more than just one company’s point of view and can offer you objective advice. At "DI For Physicians", we work with multiple insurance companies to find the most comprehensive disability insurance plan tailored to your specific needs.


 

Glossary


Accumulation Period: A period of consecutive months that begins on the first day of disability and during which the elimination period must be satisfied

Association Coverage: Group insurance issued to an association rather than to the employees of a business or members of a union.

Automatic Increase Rider: An optional benefit which provides automatic increases each year at either a stated percentage or the Consumer Price Index, despite changes in health, income or occupation.

Benefit Period: The longest period of time for which benefits are payable for continuous disability. Typical benefit periods are 5 year, to age 65, to age 67 or lifetime.

Business Overhead Expenses: A policy that reimburses a business owner for the day-to-day expenses of the business in the event of a disability. This type of policy usually has a one or two year benefit period.

Buy-Sell Agreement: An agreement made by the owners of a business to purchase the share of a disabled or deceased owner. The value of each owner's share of the business and the exact terms of the buying and selling process are established before death or the onset of a disability.

Conditional Receipt: A receipt given for premium payment accompanying an application for insurance. If the application is approved as applied for, the coverage is effective as of the date of prepayment or the date on which the last of the underwriting requirements, such as medical examination, has been fulfilled.

Conversion Privilege: The right given to an insured person to change insurance without evidence of medical insurability, usually to an individual policy, upon termination of coverage under a group contract.

Cost of Living Rider: An optional benefit which provides for increases in the disability benefit during periods of disability. The amount of increase is based on a pre-set percentage or inflation.

Cumulative Benefit: In an overhead expense policy, the monthly benefit times the number of months the insured has been disabled after the elimination period.

Earned Income: Gross salary, wages, commissions, fees, etc., derived from active employment. This does not include investment income, rents, or amounts received from annuities or insurance policies.

Elimination Period: The consecutive number of days for which no benefits are payable at the start of a claim. An insured must be disabled all of those days before benefits are payable. Typical elimination periods are 30, 60, 90, 180 or 365 days.

Exclusions: Certain conditions and causes which are not covered by the policy. These are listed in the policy.

Future Increase Option (FIO/FPO): An optional benefit in a disability income policy that allows the insured future increases to the policy monthly benefit at specified dates (typically on insured's policy anniversary), with a requirement of only financial (and not medical) insurability.

Graded Premium: A premium structure where premiums start out low and increase each year. If the insured starts with a graded premium, they may change to a level premium on a policy anniversary. Premiums will then be based on attained age.

Group Insurance: A policy covering the employees of a business or members of a union.

Guaranteed Renewable: A type of insurance which cannot be cancelled or altered by the insurance company as long as the insured continues to pay premiums on time. However, the premium may be increased for classes of insureds

Level Premium: A premium which remains the same through the insured's age 65.

Lifetime Disability Benefit: A benefit that is payable for the lifetime of the insured if continuously and totally disabled before a specified age.

Loss of Income: The difference between an insured's prior income and current income. In better policies, if the loss of income is more than 75% of prior income, the loss is deemed to be 100% for purposes of the Residual Disability Rider.

Loss Payee: The individual or entity named to receive all benefits.

Monthly Indemnity: The amount the insurer will pay for each month of total disability.

Non-Cancellable: A policy which cannot be cancelled or altered by the insurance company as long as the insured continues to pay premiums on time, and whose premium will not increase up through the insured's age 65.

Occupation: An insured's regular occupation or profession at the time of becoming disabled before age 65.

Owner: As named in the policy schedule page, the owner's rights include, but are not limited to, the right to renew the policy and to request any change in benefits.

Own Occupation: A term that defines the most liberal wording of the total disability contractual provision. If the insured, due to sickness or injury can't perform the duties of one's own

Partial Disability: An insured's physical inability to perform some, but not all, of the duties of his or her regular occupation due to sickness or injury.

Participation Limit: The total amount of coverage which will be allowed by a company from all carriers.

Policy: All material which constitutes the contract of insurance.

Pre-Existing Condition: An injury, illness, or physical condition which existed prior to the issue of the disability policy.

Presumptive Disability: The presumption that the insured is totally disabled, even if still at work, if sickness or injury results in the total and complete loss of sight in both eyes, hearing in both ears, power of speech, or use of any two limbs. The elimination period is waived from the date of the loss and total disability benefits are payable while such loss continues until the end of the benefit period.

Prior Income: The insured's average monthly income for the tax year with the highest earnings in the three years just prior to the date on which he or she became disabled.

Recovery Disability Rider: A rider which provides reduced benefits when and insured returns to work following a compensable period of total disability. Recurrent Periods of Disability: In some policies, recurrent periods of disability from the same cause or causes will be considered one continuous period of disability unless each period is separated by a recovery of six months or more.

Rehabilitation Benefit: A benefit paid to help meet some of the costs an insured may incur by enrolling in a rehabilitation program for the purpose of returning to his or her occupation.

Residual Disability: In better policies, a disability that causes an insured's income to fall more than 20% below its pre-disability level. Some companies include a loss of time requirement or the inability to perform some duties of the insured's regular occupation.

Total Disability: The physical or mental inability to perform the major duties of one's occupation because of sickness or injury.

Waiting Period: The consecutive number of days for which no benefits are payable at the start of a claim. An insured must be disabled all of those days before benefits are payable. Typical elimination periods are 30, 60, 90, or 180 days.

Waiver of Elimination Period: In some policies, the elimination period will be waived if an insured becomes disabled within five years after the end of a period of disability which lasted longer than six months and for which benefits were paid.

Waiver of Premium: In some policies, a provision which relieves the insured of having to make premium payments after he or she has been disabled for 90 days, or the elimination period, if shorter. In addition, premiums paid during those 90 days are refunded and premiums due during the 90 days after recovery are waived.

Worker's Compensation: Benefits paid to a worker to compensate for losses caused by a work-related injury or illness.