So what actually happens when doctors file a long-term disability insurance claim? Does the process go as expected or do they find themselves in for a rude awakening?
Really, it all depends on what type of insurance policy is in place.
Just as with many other contracts that doctors sign. Without reviewing the fine print, physicians tend to put their faith in the advice of the agent or other insurance representative who says they have their best interest in mind.
All too often what happens is the physician has no idea what they signed up for. They likely never even read the contract or forgot because it’s been a long time since they had gone over their coverage.
What can cause even more trouble is what happens when an insurance claim is filed on policies that didn’t require health screening when the policy was originally taken out.
Just because health screening was not required upon enrollment, doesn’t mean it won’t be required in the future. This is what happens with employer or association programs because their health can be called into question from the prior six months to two years. And that often results in denials because the insurance company is able to use it as a pre-existing condition.
There is a common misconception that disability insurance is like health insurance where the rules have changed for many policies to provide coverage in all circumstances. That is definitely not true with all long-term disability insurance.
We say beware of what is in the contract if your future income is dependent upon a policy that did not require a health screening, you may find out that the screening just comes later, when you least expect it. This is why many policies are offered at little to no cost from employers or associations because the likelihood of them paying out is minimal.
Another example is that insurance companies tout is they have “own occupation” and doctors are protected in their specialty but in reality if you read the fine print they are not.
Insurance companies are able to get away with this because they list the wording “own occupation” in their definition of disability, but then later on they include another clause that says “and not working in any occupation.”
The inclusion of this statement changes everything.
Most agents offering these kinds of programs are presenting that doctors will collect full benefits if they cannot do their occupation even if they do some form of work outside their specialty. Again, this is not true because as I mentioned before it says “not working in any occupation,” which means you would have to be completely incapable of working under any circumstances to qualify for total disability.
If you have disability insurance coverage, a disability insurance claim, or are planning to get some make sure you review and locate the fine print to see if there are any strings attached.
The last thing anyone who becomes disabled would want to hear is that the policy they trusted had a clause that gave the insurance company a way to get out of the paying the claim. There are cases in the past that have even gone to court with the disabled doctor losing because the judge sided with the insurance company because this extra clause was spelled out in the contract.
The good news is there are options available which don’t have these limitations so you don’t have to worry about this coming back to bite you. To get started, get a copy of your insurance plan, review it to make sure you are in the clear and don’t hesitate to have an independent advisor take a look since they will be able to verify the language for you very quickly.