SPRING 2015 GIHEPNEWS.COM // 27
Who needs disability insurance? Physicians who want o protect their most valuable asset – the ability to earn money –
and don’t have several million dollars
in liquid assets, or friends or family
who can provide financial support for
the next 30–40 years, should consider
procuring disability insurance.
When is the optimal time to secure
There are several reasons for securing
disability insurance sooner rather
than later. First, insurance companies
offer pricing incentives when people
lock in policies prior to becoming an
attending physician. These discounts
stay on for the life of the policy. Second, you have to prove your health to
the insurance company only one time,
which means that you won’t have to
answer any additional health questions when you increase your policy
amount in the future. Furthermore, if
your health changes prior to locking
in an initial policy, you may never be
able to secure a policy in the future.
Last, there are coverage limits that are
put into place based on where you are
in your career and how much money
you are making.
What is the “defnition of disability”?
The “definition of disability” is the litmus test that determines whether the
insurance company is required to pay
out benefits or not. The most comprehensive is “True Own Occupation With
Medical Specialty Wording,” which
provides the best coverage and is
ideal for physicians who perform procedures, such as gastroenterologists.
However, each company refers to their
specific “definition of disability” by
a different title, and the best way to
differentiate between companies is to
compare the specific wording. The difference between “and” or “or” could
be the difference of receiving benefits,
not receiving benefits, or receiving
Can I modify my disability insurance
policy when my earnings increase?
Most individual disability insurance
policies have a feature that allows
you to increase the policy amount at
a later date, and the specific compa-ny/policy determines how lenient/
rigid the terms are to increase the
benefit amount of the policy. Most
policies do not ask any medical questions when the policy is increased at
a later date, and the increase is calculated based on your health at the
policy onset and the age that you are
at the time of the increase.
Are all disability insurance policies
Disability insurance is not a standard
commodity. No two policies are the
same. There are comprehensive policies, mid-range policies, and noncomprehensive policies. The main policy
features that differentiate policies are
Definition of Disability, Benefit Duration for Mental/Nervous/Substance
and Psychiatric Related Claims, Future
Increase Option (each company calls
this something different), Cost of
Living Adjustment (COLA), Residual
Rider, Catastrophic Rider, and Student
Loan Protection Rider.
How does employer-provided
group disability insurance affect
individual disability insurance?
Ideally, you should have an individual disability insurance policy prior
to becoming an attending physician.
When you are an attending physician,
strict limits are placed on how much
disability insurance you can carry;
however, if you lock in a policy prior
to becoming an attending then that
individual policy will be grandfa-
thered in and will not count toward
this limit. On the contrary, if you are
an attending physician already, you
may be limited in securing an individ-
ual disability insurance policy if your
employer has already given you a size-
able group disability insurance policy.
What are the differences between
group disability coverage and
individual disability coverage?
Group disability policies are typically less comprehensive than top-tier
individual policies given that many
people who are covered by group
policies may not otherwise be eligible for individual disability insurance. Second, group policy benefits
are typically taxable, while individual
policy benefits are typically tax free.
Finally, group coverage typically stays
behind when you change employers
compared to an individual policy that
can move with you from job to job.
Does my current income dictate
how much disability insurance I
As a student, resident, or fellow, your
income (or lack thereof) is not a factor
when it comes to securing a policy. As
an attending physician, your income
and the amount of “other” disability
insurance (such as group disability insurance) you have dictates how much
coverage you are eligible for.
How does relocation affect my
disability insurance policy?
When you move, as long as you are
current with your premium payments, the policy will not be affected.
Is there increased pricing for
policies issued in any locations?
Policies purchased in Florida, California, Arizona, or Nevada have higher
rates and verbiage scale backs, which
means that the coverage being offered
has limitations that are not present in
policies issued in other states. If you
plan to move to one of these states, I
highly recommend that you secure a
policy before moving, as you will pay
significantly less premium and have
more comprehensive coverage.