Specialty-Specific Physician Disability Insurance – Beware the Fine Print

Definition of Disability –“Own Occupation” vs. “Any Occupation”

Beware the different definitions of disability found within disability insurance contracts. Some masquerade as if they provide true “own occupation” when in fact they do not. Make sure you get the most out of what you are paying for.

Doctors have varying degrees of understanding when it comes to the definition of disability found in a disability insurance contract (a.k.a. policy).

As the saying goes, “the devil is in the details”, so is the quality of disability insurance is found in the fine print.

For example, some insurance companies have plans that include language such as “full benefits are paid when unable to work in your own occupation” while others promise to only pay full benefits when “unable to work in any occupation.”

What does “own occupation” mean to a physician?

It means that if a physician is unable to work in the occupation of their specialty, regardless of whether or not they could work in a different occupation in medicine, teach, do research or something else outside of medicine, that they still can collect full benefits.

What this does is protect a doctor’s investment of time, energy and money in their profession.

This is important for all specialties and especially those that have invasive, interventional and surgical duties. If a surgeon cannot operate, he/she cannot do their own occupation. When this occurs, the disability insurance that has “own occupation” as the definition of disability would pay the full benefit.

What does “any occupation” mean to a physician?

The only way a doctor protected under this definition would receive the full benefit is when he/she cannot work any job.

Since there are countless ways that a physician could work outside their specialty if they were to become disabled (teaching, writing or even working as a “greeter” at the entrance of a grocery store), doctors are faced with the high risk that disability insurance with “any occupation” would not pay the full benefit.

How should doctors respond to this knowledge?

They should use it to their advantage. How?

During the process of researching disability insurance plans and companies, doctors should investigate which definition of disability the insurance company uses. Since there is a huge difference in value, it begs the question…why would a physician intentionally choose a company that only has “any occupation” language? Under normal circumstances, they don’t. Once they understand this, they choose a policy with “own” not “any” occupation.

There are unfortunate situations where doctors are sold on the premise that the insurance plan is true “own occupation” when, in reality, it is not. This happens because sales people say one thing and leave it up to the doctor to decipher the fine print that is hard to locate.

Interestingly enough, plans that appear to be true “own occupation,” but are not actually, tend to cost more. Common sense would lead most to believe it would cost less, but not in this case. Having said this, it is crucial for physicians in the process of researching and establishing their individually owned disability insurance plan to have full knowledge of what the plan entails.

How does employer provided or association group disability insurance fit into this conversation?

As mentioned in previous Practice Management Tips, disability insurance plans offered by employers or associations do not have true “own occupation” and therefore contain the “any occupation” definition. This is one of the chief reasons that employer plans are provided at no cost to employees and association plans are low cost. Just as with everything “you get what you pay for,” the same rule applies here with disability insurance.

With all of this in mind, physicians who remember the distinction between true “own occupation” and “any occupation” can protect themselves from getting less than they think they are paying for. They can also be protected from mistakenly assuming that the employer’s plan or the association plan truly protects their “own occupation.”

Physicians who want to begin researching their options for disability insurance and want to lock in the lowest rates in 2011 have less than four weeks left.

To get the process started, physicians need to complete the secure form via the link below.

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There is no cost to research options and once the results come back from the top insurance companies that protect a physician’s own occupation, one of our advisors can present them.

As always, if you have questions or want to discuss Practice Management, please don’t hesitate to contact our office.

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