How Does Disability Insurance Cover Cancer?

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In the event of a cancer diagnosis, disability insurance can serve as an essential safety net for physicians to safeguard their earnings and finances. While the prognosis for different cancers can vary widely, most cancer diagnoses will necessitate time off work for proper treatment. Whether this time off lasts for a few weeks or a few years, a long-term disability insurance policy can pay benefits for the duration of your condition. However, physicians can only receive disability benefits from a policy purchased prior to their cancer diagnosis.

As harrowing as cancer can be, a long-term disability policy can help ease the process of recovery by providing peace of mind and financial security. If you learn you have cancer, you should quickly take full stock of all sources of disability coverage available to you. There are several kinds of disability insurance that can provide varying degrees of coverage in the event of a cancer diagnosis.

Short-term disability insurance is typically offered to physicians by their employers as a workplace benefit. Usually a short-term disability policy will cover absences ranging from a few weeks up to six months. While short-term disability insurance can be a useful supplement, these policies have limited benefit periods and common coverage gaps that will prove insufficient to protect a physician’s financial security in the event of a prolonged disability. One of our advisors can help you understand the details of your employer’s short-term disability insurance coverage.

Long-term disability insurance is usually purchased as an independent policy by a physician to cover a disability with payouts beginning as early as 90 days after an illness or injury. The benefit period of a long-term disability (LTD) policy can last for a predetermined period of years or even cover the duration of a doctor’s career with the usual coverage paying you until the age of 65 or 67. Own-occupation long-term disability insurance is the most valuable form of financial protection for a physician in the event of any illness or disability. However, not all LTD insurance policies are created equal; to offer the necessary protection, a policy must offer true own-occupation disability coverage that pays benefits in the event that you’re unable to perform key functions of your own specialty. For a comprehensive review of the requirements, exclusions, and benefits of your LTD policy, talk with one of our advisors.

Social security disability insurance or (SSDI) is a federal program that in some cases can offer additional benefits in the event of a disabling cancerous condition. If your cancer diagnosis is expected to result in a disability for at least a year’s time and your recent work history indicates you have contributed to social security, you may qualify for benefit payments through  SSDI. For details regarding social security disability benefits, eligibility, and how to apply, you can learn more here.

After a cancer diagnosis, you will not be able to purchase a disability policy or additional coverage until well after your condition is in full remission. While this reality can be frustrating for a physician scrambling to find last-minute financial support after a serious diagnosis, it is a logical policy on the part of insurance companies. Insurance companies naturally want to minimize the risk that they will have to pay out costly disability benefits, and they are virtually guaranteed to lose money by selling a policy to an individual with cancer.  This underscores the importance of purchasing an own-occupation LTD policy at the beginning of your medical career to lock-in a guaranteed financial safety net.

Filing a Disability Claim for Cancer

It takes more than just a diagnosis of cancer to ensure that you receive disability benefits from any type of insurance, whether it’s short-term, long-term, or through social security. Depending on the type of cancer and individual prognosis, the necessary care could range from a single outpatient procedure to months of prolonged treatment. As a result, your insurance company will require a statement from your doctor verifying that the status of your condition meets the definition of “disability” outlined by your specific policy and the most comprehensive definition of an illness or injury is own-occupation.

Depending on the details of your policy, if your disability is deemed partial, you may only receive partial benefits. More restrictive policies may refuse to pay benefits entirely if your health status still permits you to perform any occupation in the medical field or any other field. When purchasing a long-term disability insurance, avoid policies with these common exceptions and exclusions, because the resulting coverage will be inadequate in the event of a serious cancer diagnosis and might not pay you.

Purchasing disability insurance after cancer recovery

A previous cancer diagnosis does not make a physician completely uninsurable for the rest of his or her career. Once a cancerous condition is in remission, it is possible for a doctor to apply for a disability insurance policy that provides coverage for any other illnesses or injuries that may arise in the future.

Depending on the insurance carrier, an individual with a previous cancer diagnosis may have to wait several years after their condition is in remission before they can purchase a new disability insurance policy. Policyholders with cancer as a pre-existing condition can also expect to pay higher premiums for future disability coverage. These hurdles can be immensely frustrating for physicians who feel as if they are being unfairly penalized for a previous illness. Nevertheless, it is still possible, and critical, for every physician to invest in high-quality disability insurance, ideally prior to any medical condition noted in your chart.

Each insurance carrier uses different criteria to underwrite policies, and each policyholder’s medical history is evaluated on a case-by-case basis. For example, the coverage options for a physician who has recovered from the early stages of localized breast cancer will be very different from those available to a physician who has recovered from advanced lymphoma. If you’re looking to purchase a disability policy after recovering from cancer, one of our advisors can help you find an affordable policy with the necessary coverage.

Conclusion

Navigating the disability insurance marketplace during or after a cancer diagnosis can add tremendous stress to an already difficult time. Physicians are best advised to purchase an individual own-occupation long-term disability insurance policy when they are still young and healthy in order to guarantee reliable, affordable coverage. If a physician does become disabled by cancer, disability insurance offers unparalleled financial protection to offset lost income. To ensure that your livelihood is protected in the event of a serious illness such as cancer, talk with one of our trusted insurance specialists.

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