Disability Insurance

[poopythrowaway]

Hi all-

I'm a 2nd year GI fellow, not planning to do any further training after completing fellowship. Looking to get some information about disability insurance. I've gone through a disability agent who has presented many different options for own-occupation disability insurance. Truthfully I'm a bit overwhelmed in trying to navigate the nuances of different policies. I'm looking for guidance from those of you who have been through this already. A couple things I consider "essential" for disability insurance (I obtained this list from reading White Coat Investor):

1. Own-occupation disability insurance (separate from employer-based disability, which I already have)
2. Cost of living rider
3. Future purchase option rider
4. Residual disability rider

Specific things I need help with:
1. Are all of those things I mentioned above truly essential?
2. Graded vs. Fixed premiums. Fixed premiums are higher than graded premiums but I imagine the benefit is they stay the same once I'm an attending vs. fellow, and cannot change over time. Is this the right play? Could someone shed some insight on which to go with? While the price differential is about $100/month (which is a lot as a fellow), I imagine as an attending that difference will be negligible. Is there usually a cap on premiums if going with the graded premiums?
3. General cost - I am looking at multiple policies at the moment, and most of them are around $130-200 for graded and $200-350 for fixed premiums. Is this correct?

Any other general advice regarding this process would be helpful. Thanks in advance!

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[ChessMaster3000]

Hi all-

I'm a 2nd year GI fellow, not planning to do any further training after completing fellowship. Looking to get some information about disability insurance. I've gone through a disability agent who has presented many different options for own-occupation disability insurance. Truthfully I'm a bit overwhelmed in trying to navigate the nuances of different policies. I'm looking for guidance from those of you who have been through this already. A couple things I consider "essential" for disability insurance (I obtained this list from reading White Coat Investor):

1. Own-occupation disability insurance (separate from employer-based disability, which I already have)
2. Cost of living rider
3. Future purchase option rider
4. Residual disability rider

Specific things I need help with:
1. Are all of those things I mentioned above truly essential?
2. Graded vs. Fixed premiums. Fixed premiums are higher than graded premiums but I imagine the benefit is they stay the same once I'm an attending vs. fellow, and cannot change over time. Is this the right play? Could someone shed some insight on which to go with? While the price differential is about $100/month (which is a lot as a fellow), I imagine as an attending that difference will be negligible. Is there usually a cap on premiums if going with the graded premiums?
3. General cost - I am looking at multiple policies at the moment, and most of them are around $130-200 for graded and $200-350 for fixed premiums. Is this correct?

Any other general advice regarding this process would be helpful. Thanks in advance!

Google the white coat investor. You will learn.


In my opinion cost of living COLA is a waste

 

[1Cor1557]

Hi all-

I'm a 2nd year GI fellow, not planning to do any further training after completing fellowship. Looking to get some information about disability insurance. I've gone through a disability agent who has presented many different options for own-occupation disability insurance. Truthfully I'm a bit overwhelmed in trying to navigate the nuances of different policies. I'm looking for guidance from those of you who have been through this already. A couple things I consider "essential" for disability insurance (I obtained this list from reading White Coat Investor):

1. Own-occupation disability insurance (separate from employer-based disability, which I already have)
2. Cost of living rider
3. Future purchase option rider
4. Residual disability rider

Specific things I need help with:
1. Are all of those things I mentioned above truly essential?
2. Graded vs. Fixed premiums. Fixed premiums are higher than graded premiums but I imagine the benefit is they stay the same once I'm an attending vs. fellow, and cannot change over time. Is this the right play? Could someone shed some insight on which to go with? While the price differential is about $100/month (which is a lot as a fellow), I imagine as an attending that difference will be negligible. Is there usually a cap on premiums if going with the graded premiums?
3. General cost - I am looking at multiple policies at the moment, and most of them are around $130-200 for graded and $200-350 for fixed premiums. Is this correct?

Any other general advice regarding this process would be helpful. Thanks in advance!

As long as you have a future purchase option rider and it's specialty specific you will be okay. That way you can dramatically increase the coverage once you're an attending next year on whichever policy you choose and if God forbid you ever lose your thumbs and can't scope again you Will still collect the full or majority payout of the policy while being an internist

 

[anonperson]

Hi all-

I'm a 2nd year GI fellow, not planning to do any further training after completing fellowship. Looking to get some information about disability insurance. I've gone through a disability agent who has presented many different options for own-occupation disability insurance. Truthfully I'm a bit overwhelmed in trying to navigate the nuances of different policies. I'm looking for guidance from those of you who have been through this already. A couple things I consider "essential" for disability insurance (I obtained this list from reading White Coat Investor):

1. Own-occupation disability insurance (separate from employer-based disability, which I already have)
2. Cost of living rider
3. Future purchase option rider
4. Residual disability rider

Specific things I need help with:
1. Are all of those things I mentioned above truly essential?
2. Graded vs. Fixed premiums. Fixed premiums are higher than graded premiums but I imagine the benefit is they stay the same once I'm an attending vs. fellow, and cannot change over time. Is this the right play? Could someone shed some insight on which to go with? While the price differential is about $100/month (which is a lot as a fellow), I imagine as an attending that difference will be negligible. Is there usually a cap on premiums if going with the graded premiums?
3. General cost - I am looking at multiple policies at the moment, and most of them are around $130-200 for graded and $200-350 for fixed premiums. Is this correct?

Any other general advice regarding this process would be helpful. Thanks in advance!

Make sure it is true own occupation and specific to you being able to practice your specialty (GI).

I am only familiar with fixed cost.

How much coverage is the $200 to $350 giving you? I am assuming it is $5000/ month since you are a fellow.

There are only a few companies that offer disability insurance. I would make sure you research and make sure you deal with a company that doesn't have have a reputation for not paying out.

I am with the Standard. Expensive policy. Haven't heard anything negative about them but who knows. I hope to never test it out.

 

[Phosphorus]

Future increase option very important. Own occupation. I didn't get residual disability. I did purchase FIO and COLA.

Recommend if you are a male then going for gender-specific. If you are a female try and get gender neutral if still available (women pay more for disability).

 

[ChessMaster3000]

Future increase option very important. Own occupation. I didn't get residual disability. I did purchase FIO and COLA.

Recommend if you are a male then going for gender-specific. If you are a female try and get gender neutral if still available (women pay more for disability).

What company did you go with and why

 

[deleted980918]

I would also recommend getting a term life insurance while you are young. It’s significantly cheaper than disability insurance and give you a peace of mind for your loved ones amid chaos we are currently going through. I got mine the week before fellowship started was about $800 a year on $2M policy until age 65.

 

[chessknt]

I would also recommend getting a term life insurance while you are young. It’s significantly cheaper than disability insurance and give you a peace of mind for your loved ones amid chaos we are currently going through. I got mine the week before fellowship started was about $800 a year on $2M policy until age 65.

You only need this if you have family who are dependent on your income.

 

[ShiShiMD]

I got it in fellowship, 7000$ worth for like 170$ with the option to upgrade to 10000$ and got from employer once I finished fellowship additional 5000$ for around the same price. Make sure you have the correct riders and all.

OCCUPATION SPECIFIC. if god forbids you cant scope, you can still consult but get the DI income also.

 

[deleted980918]

You only need this if you have family who are dependent on your income.

That’s true but it’s always a good to know that your loved ones will be taken care of financially God forbids something happens to you even if they don’t rely on your income.

 

[MD Financial Services Scott]

Hi all-

I'm a 2nd year GI fellow, not planning to do any further training after completing fellowship. Looking to get some information about disability insurance. I've gone through a disability agent who has presented many different options for own-occupation disability insurance. Truthfully I'm a bit overwhelmed in trying to navigate the nuances of different policies. I'm looking for guidance from those of you who have been through this already. A couple things I consider "essential" for disability insurance (I obtained this list from reading White Coat Investor):

1. Own-occupation disability insurance (separate from employer-based disability, which I already have)
2. Cost of living rider
3. Future purchase option rider
4. Residual disability rider

Specific things I need help with:
1. Are all of those things I mentioned above truly essential?
2. Graded vs. Fixed premiums. Fixed premiums are higher than graded premiums but I imagine the benefit is they stay the same once I'm an attending vs. fellow, and cannot change over time. Is this the right play? Could someone shed some insight on which to go with? While the price differential is about $100/month (which is a lot as a fellow), I imagine as an attending that difference will be negligible. Is there usually a cap on premiums if going with the graded premiums?
3. General cost - I am looking at multiple policies at the moment, and most of them are around $130-200 for graded and $200-350 for fixed premiums. Is this correct?

Any other general advice regarding this process would be helpful. Thanks in advance!

In my opinion:
Own Occupation- don't buy if there is a 'not engaged' commentary in there, this is very important.
COLA- think about the cost for that rider vs. just using that same premium you would have been paying for the COLA to buy more benefit and then how many years On Claim you will have to be before the cumulative benefits paid under plan with COLA vs. without.
Future Purchase Options- those are important so be sure you know if you are getting Future Purchase Options, Future Increase Options or Benefit Update options as they all function differently and have different costs to you.
Residual- pretty critical because that pays a partial claim while you are still working in your specialty but at a reduced capacity.

Graded is fine to do while in training but if you plan on holding the policy very long you will want to change that to a level premium, yes it costs more today but will be less in the future. Be sure to price shop all of the big 6 carriers for the best price on both graded and level.

The prices seem a bit high for a typical fellow aged individual but it all depends on your age, gender, and state of residency.

 

[mepo12]

I am a PGY1 (27) now and debating waiting until PGY5 (rads) to get disability insurance with Principal. I was quoted for $1125 a month for $23 with future purchase option and get 10 or 15K as an attending for 205 or 307 month, respectively. Would these rates hold up when I'm PGY5 as well? I'll be making roughly 30K more during PGY5 than I am now (prelim) if that matters. Would the money saved ($23 a month for 4.5 more years or around 1200 bucks) be worth better saved than applying PGY5?

Any help would be greatly appreciated!

 

[MD Financial Services Scott]

Are you saying that you are considering buying an $1,125 monthly benefit contract with Principal at $23 per month locked in? If so then yes you can do that while locking in options to $20k as an attending assuming you qualify for that then. As for the rates in the future no rep can tell you with certainty what that rate will be with Principal as they don't guarantee the rates rather they are promising the issuance of the benefit. Variables of Principal can be your then current age, state you live in, or if they have changed discounts.

Nobody can answer the question on if saving saving the money and not buying the policy now vs. buying now because until you get to that spot and are able to look back you can't tell. If you don't have any health issues, rates don't change, discounts don't change, you don't move states, and occupation classes don't change then you might be better off not buying, if any of those change you are probably better off buying now. One thing for sure is in 4 years you will be older thus the cost, if everything else is the same, will be more just due to age increase, in 4 years assume that the cost per dollar of benefit will 20% more.

 

[mepo12]

Are you saying that you are considering buying an $1,125 monthly benefit contract with Principal at $23 per month locked in? If so then yes you can do that while locking in options to $20k as an attending assuming you qualify for that then. As for the rates in the future no rep can tell you with certainty what that rate will be with Principal as they don't guarantee the rates rather they are promising the issuance of the benefit. Variables of Principal can be your then current age, state you live in, or if they have changed discounts.

Nobody can answer the question on if saving saving the money and not buying the policy now vs. buying now because until you get to that spot and are able to look back you can't tell. If you don't have any health issues, rates don't change, discounts don't change, you don't move states, and occupation classes don't change then you might be better off not buying, if any of those change you are probably better off buying now. One thing for sure is in 4 years you will be older thus the cost, if everything else is the same, will be more just due to age increase, in 4 years assume that the cost per dollar of benefit will 20% more.

oh wow i thought the future increase option rider would lock in that 15K a month benefit rate at $300 a month, is that not how it works? What would the point "locking the rate in" now be then?!

 

[MD Financial Services Scott]

oh wow i thought the future increase option rider would lock in that 15K a month benefit rate at $300 a month, is that not how it works? What would the point "locking the rate in" now be then?!

It sounds like the rep did not properly inform you. With Principal while using the Benefit Update (BU) it locks in your health and advocation but the rate will be determined at the time of increase based on your age, discounts and state that you are in. The advantage here is that your health and advocations will not be reviewed again. There are only a couple of carriers that lock in your rate structure and base everything off of the originating state but even with those the cost will be determined by the age you are at the time of increase.

 

[mepo12]

It sounds like the rep did not properly inform you. With Principal while using the Benefit Update (BU) it locks in your health and advocation but the rate will be determined at the time of increase based on your age, discounts and state that you are in. The advantage here is that your health and advocations will not be reviewed again. There are only a couple of carriers that lock in your rate structure and base everything off of the originating state but even with those the cost will be determined by the age you are at the time of increase.

ahh ok that makes sense, so the only thing i'm really locking in is my current health. IF I get sick and I decide to increase my policy from $1125 to $15K a month as an attending, they wont factor in my health when they give me a new rate.

This whole time I thought I could just increase my benefit to 15K for $300 a month when I'm an attending!

Would you still recommend principal for $23 a month for $1125 of coverage?

 

[MD Financial Services Scott]

ahh ok that makes sense, so the only thing i'm really locking in is my current health. IF I get sick and I decide to increase my policy from $1125 to $15K a month as an attending, they wont factor in my health when they give me a new rate.

This whole time I thought I could just increase my benefit to 15K for $300 a month when I'm an attending!

Would you still recommend principal for $23 a month for $1125 of coverage?

Well it kind of works that way....with a BU process you have to have financials reviewed every 3 years and you have to maintain 50% of the eligible benefit or they take away the ability to increase in the future. If you bought $1125 and then in 3 years were not compliant with the review for any number of reasons (got busy, moved and did not update address, did not want it, etc.) then your contract would be stuck at $1125. If you were compliant, were eligible for more benefit and had a health issue then yes you can increase without current health issues being considered.

What is recommended is really a personal issue, based on age, gender, medical specialty, state of residence, where you might move to, how much you want to spend, the design features desired, and current health status.

 

[1Cor1557]

I am a PGY1 (27) now and debating waiting until PGY5 (rads) to get disability insurance with Principal. I was quoted for $1125 a month for $23 with future purchase option and get 10 or 15K as an attending for 205 or 307 month, respectively. Would these rates hold up when I'm PGY5 as well? I'll be making roughly 30K more during PGY5 than I am now (prelim) if that matters. Would the money saved ($23 a month for 4.5 more years or around 1200 bucks) be worth better saved than applying PGY5?

Any help would be greatly appreciated!

It depends what you get It should be specialty specific So if you end up doing interventional radiology and you break both of your thumbs off and you can't ever do VIR ever again you can still collect,while sitting in the diagnostic reading rooms full-time still

 

[mepo12]

Thanks all for the help! Ill lock in that $23 a month plan for $1125 then re-evaluate in 3 years. In 5 years after fellowship I'll bump it up to 10-15K a month!

 

[GIorDIE89]

What is it in your DI that states specialty specific? I don't remember seeing this as an option.

 

[MD Financial Services Scott]

Most of the contracts that are own specialty will have:
If you are a physician or dentist and have limited your duties to the performance of the usual and
customary functions of a specific, professionally recognized medical or dental specialty, we will consider
that specialty your occupation.

If the Own Specialty definition was included in the policy, if you chose to work in a different
occupation, then you would be eligible to receive 100% of the Maximum Monthly Benefit.

 

[MD Financial Services Scott]

Hi all-

I'm a 2nd year GI fellow, not planning to do any further training after completing fellowship. Looking to get some information about disability insurance. I've gone through a disability agent who has presented many different options for own-occupation disability insurance. Truthfully I'm a bit overwhelmed in trying to navigate the nuances of different policies. I'm looking for guidance from those of you who have been through this already. A couple things I consider "essential" for disability insurance (I obtained this list from reading White Coat Investor):

1. Own-occupation disability insurance (separate from employer-based disability, which I already have)
2. Cost of living rider
3. Future purchase option rider
4. Residual disability rider

Specific things I need help with:
1. Are all of those things I mentioned above truly essential?
2. Graded vs. Fixed premiums. Fixed premiums are higher than graded premiums but I imagine the benefit is they stay the same once I'm an attending vs. fellow, and cannot change over time. Is this the right play? Could someone shed some insight on which to go with? While the price differential is about $100/month (which is a lot as a fellow), I imagine as an attending that difference will be negligible. Is there usually a cap on premiums if going with the graded premiums?
3. General cost - I am looking at multiple policies at the moment, and most of them are around $130-200 for graded and $200-350 for fixed premiums. Is this correct?

Any other general advice regarding this process would be helpful. Thanks in advance!

I would really look at the value proposition on the Cola vs. just using that same premium to buy more benefit. The amount of time 'on claim' to make that a better deal than having just bought more coverage is really kind of amazing.

When looking at the graded vs. fixed rates you should compare the graded against graded (Guardian and Ohio) and then look to see how competitive they are on the fixed rate in case you later convert. The reason to do this is you don't want to get sucked into a graded policy to then convert if the conversion is to a product that is higher priced in the market for the fixed rate. Some times you can see 20-35% price differences for the same designed product but by different carriers.

Those rates seem high for a typical 2 year fellow, especially in GI.

 

[LeJoker]

Thank you all for your input here.

I’m a PGY-3 in similar position to the OP. I wanted to verify that my understanding is correct that locking in a low rate for benefits around $1000 would allow for future increases as desired, and would have only the disadvantage of not providing as much benefit were I to become disabled before I increased benefit in a few years. Does this sound correct?

 

[MD Financial Services Scott]

Thank you all for your input here.

I’m a PGY-3 in similar position to the OP. I wanted to verify that my understanding is correct that locking in a low rate for benefits around $1000 would allow for future increases as desired, and would have only the disadvantage of not providing as much benefit were I to become disabled before I increased benefit in a few years. Does this sound correct?

Locking in a policy with Future Purchase Option or Benefit Update rights will allow those increases to happen without further medical review upon the increase. Depending on the amount you purchase initially one of those features will work better than the other so look at that carefully.