Every policy has different features. The following checklist will help you compare policies you may be considering.
1. How is disability defined? Is it defined as the inability to perform your own job, or inability to do any job?
We recommend all our clients, as physicians, to obtain a policy that protects them in their own specialty. This kind of policy is defined as an own-occupation policy, which protects the income you earn in your own specialty and continues to pay benefits if your disability requires that you choose a new specialty or occupation.
2. Are benefits available for partial or residual disability, as well as for full disability?
The most comprehensive policies will pay you a benefit even if you are not completely disabled. If you can only earn up to 20% of your income you are deemed totally disabled; if you can earn 80% or more you are deemed totally well. Partial or residual policies pay benefits when you fall in the category between 20-80%.
3. Are full benefits paid, whether or not you are able to work, for loss of sight, loss of hearing, or loss of limbs?
This is called a presumptive disability. Some policies do not cover presumptive disability, some cover you for a specified amount of time, and some protect you for life.
4. What is the maximum benefit I am eligible for?
The amount is based on your income and specialty to a maximum of $20,000 per month with one company, and $30,000 per month with all companies.
5. Is the policy non-cancelable, guaranteed renewable, or conditionally renewable?
The most comprehensive policies are non-cancelable and guaranteed renewable; these put you in total control, not the insurance company, practice or association. The insurance company cannot raise rates, cannot reduce benefits, add exclusions, or cancel your policy at anytime. You are in control, and the policy is portable and goes wherever you go.
6. How long must you be disabled before premiums are waived?
Premiums are waived at the end of the waiting period and refunded for the amount paid during the waiting period.
7. Is there an option to buy additional coverage, without undergoing additional medical tests or examinations, at a later date?
Yes, this option is available as a rider under a number of names. It is a guaranteed insurability rider and typically needs to be added to the base policy as a rider. It is critical for a physician just beginning practice to have this option available in order to keep coverage in line with income. The only requirement necessary to exercise this option is income documentation.
8. Does the policy offer an inflation adjustment feature? If so, what is the rate of inflation? Is there a maximum?
This feature is available by an added rider. Ask a licensed DI4MDs.com agent if inflation protection fits your needs.
Factors affecting premium rates:
1. Medical specialty (invasive vs. non-invasive)
-Most companies have higher premium rates for invasive specialties.
2. State of residence
3. State of issue
6. Health status
7. Discount programs
8. Policy riders quoted
9. Type of policy
Up to 50% of disability insurance policies are not approved as applied for. Medical history and avocations can lead to policies that contain exclusions.
Typically, the annual premium is equal to 1-3% of annual income.
…at DI4MDs we can help you determine the following:
What is an adequate level of benefits in relation to your present and future obligations?
How long a waiting period (until benefits begin) should you select to fit your situation?
How long do you want to receive disability income should it become necessary?
How much coverage can you get at your current salary?