Disability Insurance

Widening the Disability Insurance Gender Gap

Females present higher risk of disability and will soon pay for it with higher premiums.

The odds of a female filing a claim is higher than a male and insurance companies are about to adjust their rates to reflect the higher risk.

Female Disability: 40% higher risk and 60% higher insurance costs

It seems almost paradoxical that women pay more for disability insurance coverage than men. After all, as many would argue, women are the smarter sex, as whole they take better care of themselves, and they tend to be more cautious than men. You would think, then, they would be less likely to incur a debilitating injury that would prevent them from working. And, as a group, women live longer than men, which is why they pay less than men for life insurance coverage. However, as the statistics clearly show,women are 40 percent more likely to become disabled due to a long lasting illness and are, therefore, more likely to file a disability claim. Accordingly, insurers charge women, on average about 60 percent more for disability coverage.

What makes women more expensive to insure?

Among some of the conditions that result in disability claims for women are:

Autoimmune Disorders: While both men and women can suffer from autoimmune disorders, women are much more likely to develop chronic conditions such as lupus, Graves disease, chronic fatigue, multiple sclerosis and inflammatory bowel disease. Many of these conditions can cause long periods of disability.

Depression: Men suffer from depression too; however, it is much more likely to occur in women because some of the leading causes are related to biological issues with women, such as premenstrual and pregnancy complications, and postpartum disorders. Although many insurers won’t cover depression or limit its coverage, it can often be linked to a biological issue which may be covered.

Maternity: One in four women will experience some sort of complication that could prevent them working during pregnancy or lengthen the time of post-pregnancy recovery. The science is still out on why women tend to suffer more chronic diseases or depression; however, the only thing that matters to insurers is the statistics which is indisputable. So, unfortunately, no matter how well you take care of yourself to prevent the onset of any medical condition, your premium rate is still going to be higher than a man’s.

Why Female Physicians Need to Act on Disability Coverage Sooner than Later

With that said, it is still important to strive for good health so that you can qualify for the lowest premium rate available to women. And, equally important, so you can avoid any medical exclusion riders that would preclude you from collecting on a claim that is related to that condition, such as a back injury or the onset of a chronic condition.

It’s highly recommended that female physicians purchase individual disability coverage as early in their career as possible while they’re young and healthy in order to lock in the lowest rates possible and head off any potential medical exclusions.

It’s also suggested that women obtain their disability coverage well in advance of planned pregnancies. It’s not uncommon for medical conditions to be uncovered during pre-pregnancy tests that could preclude the pregnancy from being covered. In one case, a female physician in her early thirties who had yet to purchase individual coverage, underwent fertility treatments only to discover she had developed uterine fibroids.

Otherwise healthy, the insurer applied a medical exclusion for her eventual pregnancy when she went to apply for coverage.

Disability Insurance Options for Female Physicians

Female physicians understand the importance of protecting their most valuable asset – their ability to earn a high income – and while there’s always needs to be some consideration for the cost of coverage, there is still the statistical chance that they will need to file a disability claim. That is all the more reason while female physicians need to be especially careful in selecting the right type of coverage. It is essential that they choose only specialty-specific disability coverage offered through the top specialty carriers.

As to the cost of coverage, a few carriers still offer “unisex” rates which could lower the cost of coverage by as much as 45 percent. However, unisex rate policies are typically offered as multi-life plans requiring a minimum of three insureds to join together. Residents and fellows have a unique opportunity to save as much as 80% on insurance costs by beating the rate hike and using their training discount. It would still be important to compare the benefits and features of these plans with other, non-unisex plans to ensure you are receiving the best coverage available.