WHY TRUE OWN OCCUPATION DISABILITY INSURANCE?
You have worked hard to get to where you are. You’ve not only made a large financial investment in your future, but also an enormous time investment. Becoming sick or hurt could derail your plans on the rewarding career ahead of you, in addition to the financial goals you surely have. As a physician, you have a special skill set, and that skill set must be properly insured to protect against becoming disabled. True Own Occupation Disability Insurance will do just that.
LET’S DEFINE DISABILITY
Disability means the inability to perform the material and substantial duties of your occupation due to a sickness or injury. The best disability policies out there will offer a “specialty own occupation” definition. That means if, due to sickness or injury, you can’t perform the material and substantial duties of your specialty, EVEN if you are working in another occupation, you will receive your total disability benefits. You see most people think of someone in a wheelchair when they think of a disability. But disabilities can be hard to spot. It’s the surgeon with scar tissue in his wrist, the dentist with back pain, the professional with Lyme disease. And let’s not forget the serious conditions like cancer, stroke, heart attack, MS, diabetes or catastrophic accidents. The point is, no matter what sickness or injury prevents you from doing what you worked so hard to become, you want to get paid.
BENEFITS OF BUYING AS A RESIDENT OR FIRST YEAR PHYSICIAN
- Special Limits – The carriers know you’ll have high incomes in the future so they will offer anywhere between $5,000 and $7,500 per month of coverage without providing financials
- Simplified Underwriting – Some carriers will only require a medical questionairre (non-med) but waive the physical exam
- Discounts – If you are in an endorsed program you may be eligible for 10-20% (or higher) Discounts
- Protection – It always makes the most sense to get coverage now, rather than waiting
PREMIUM OPTIONS
- Graded – Graded is a lower monthly rate, however, every year your premiums will increase according to the outlined schedule. Eventually you’ll want to convert to level, at which time you will pay rates at your attained age.
- Level – This is over time the cheapest way to pay by locking in your rates right from the start. However, if cash flow is tight as a young resident, there’s no harm in starting off graded and then converting to level once cash flow increases with your first big contract.
WHAT SHOULD YOU LOOK FOR IN AN OWN OCCUPATION DISABILITY POLICY?
FUTURE INCREASE OPTIONS – Right now you may be earning a modest salary as a resident. However, soon enough your income will climb drastically. Right now you’re the youngest and most likely the healthiest you’ll ever be. By having increase options on your policy, you are able in increase your coverage without proving medical insurability in the future.
PARTIAL DISABILITY – Not all disabilities cause a total disability. Partial riders protect your lost income in the event of a partial disability. The majority of claims paid have a partial component to them. This is an important rider to have.
COLA – “Cost of living adjustment” helps you keep up with inflation in the event you are on claim. Various carriers have this rider, some with a simple 3%, some a compounding 3%, some tied to the CPI with floors and ceilings. The younger you are, the greater your inflation rate risk, and the more this rider will positively effect a disability benefit.
CATASTROPHIC – Some disabilities are really serious. These are the ones that our minds jump to when we think of someone in a wheelchair. Most rider definitions of Catastropic provide an additional benefit if the client can’t perform 2 out of the 6 activities of daily living, or if they have a cognitive impairment.
STUDENT LOAN RIDER – Possibly the most requested rider from residents, student loan riders provide a reimbursement for their student loans. As we all know, student loans are not easily forgivable. Having this rider protects the large debt obligations physicians have taken on in order to get to where they are.
NON CANCELABLE, GUARANTEED RENEWABLE – This means the carrier can’t change the premiums on you or change the policy so long as you pay your premiums.
A well constructed policy will properly protect your income, and what you’ve invested in your career!
ARE YOU READY FOR YOUR COMPLIMENTARY DISABILITY QUOTE?
NO OBLIGATION. ALL OF YOUR INFORMATION IS CONFIDENTIAL