Disability Insurance

[kbrown]

Hey all,

I was perusing the Gen Res forum re this issue. In Sept 05 I did a rotation at Chrisitiana and some people came to talk about this (Disability Insurance). I know that there are some Christiana folks cruising this forum, and many more who probably know a lot about this. If any of you remember the details about DI, I would appreciate any words of wisdom. I am not remembering enough to discern details of certain plans. Something about "own occupation" means that you need to be able to perform what you are certified in, but if you don't get that, then you end up reading insurance claims forever with no pay from insurance company.

Obviously, based on my above interpretation I am desperately in need of a touch of guidance. I don't care if you want to type it out, or just post a link. I just want some more info. Thanks in advance.

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[JackBauERfan]

same here, I just was scanning over some of my orientation stuff and it talks about disability insurance...and I'm kind of naive on this stuff... any decent links or advice about this? Is it something most residents end up getting? They kind of breezed over the disability stuff in orientation, just talked about health/dental/life alllllll day.

 

[12R34Y]

Hey all,

I was perusing the Gen Res forum re this issue. In Sept 05 I did a rotation at Chrisitiana and some people came to talk about this (Disability Insurance). I know that there are some Christiana folks cruising this forum, and many more who probably know a lot about this. If any of you remember the details about DI, I would appreciate any words of wisdom. I am not remembering enough to discern details of certain plans. Something about "own occupation" means that you need to be able to perform what you are certified in, but if you don't get that, then you end up reading insurance claims forever with no pay from insurance company.

Obviously, based on my above interpretation I am desperately in need of a touch of guidance. I don't care if you want to type it out, or just post a link. I just want some more info. Thanks in advance.

I just got my DI policy the other day. I've been learning a lot.

Guardian/Berkshire and Northwestern Mutual are the 2 companies that are doing physician DI policies.

You HAVE to have the following:

true own occupation (ie can't be an EM doc and work in ED then you get full benefits).

non-cancellable,

future increase in earnings option (very important).

COLA rider (cost of living)

there are other things, but this is important.

GuardianBerkshire and Northwest mutual will pay you during your residency 42,000-45,000/year if you are disabled to at least 65y/o.

Then when you get out of residency and sign that 200,000/year contract you get your benefits increased to about 6500/month.

The max benefit is like 10,000/month.

Trust me............i've done my homework. GuardianBerkshire and NOrthwest mutual are the physician DI market.

Unum provident also has some physician DI as well.

look into the two i mentioned and they're both great.

The thing is do it NOW so you lock in your rates for life and you qualify.

If you wait you may be disabled and of course then you are just out of luck.

later

 

[12R34Y]

I just thought I'd reiterate......... (no i don't sell insurance ), but DI may be the most important insurance you can get as a physician.

you've spent your whole life and have gone into 100,000.00 plus in debt to do one thing.........be a doc and plan on making enough to pay all of that back.

I keep thinking of my wife and kids and say what if a guy rear ends me tomorrow and i have intractable horrible headaches/neck pain and weakness in an arm or something...........well, i'm screwed.

I can't work as an ER doc.........loans will still come due and I've just screwed my family.

Get the best/sweetest DI policy out there it is HUGE!

later

 

[JackBauERfan]

I just thought I'd reiterate......... (no i don't sell insurance ), but DI may be the most important insurance you can get as a physician.

you've spent your whole life and have gone into 100,000.00 plus in debt to do one thing.........be a doc and plan on making enough to pay all of that back.

I keep thinking of my wife and kids and say what if a guy rear ends me tomorrow and i have intractable horrible headaches/neck pain and weakness in an arm or something...........well, i'm screwed.

I can't work as an ER doc.........loans will still come due and I've just screwed my family.

Get the best/sweetest DI policy out there it is HUGE!

later

Thanks, looks like you have done your homework haha. I'll check into those two.

anyone else have any thoughts (not to say you are wrong 12r34y, but just checking out all options!

 

[doctordi]

I am glad to see that all of you are interested in disability insurance. I am a financial planner and my company specializes in disability insurance for residents and physicians, we perform educational seminars at residency programs often. Please feel free to email me for more information, or just plain advice. Ok the basics

Lock in young and healthy with a non-cancellable guaranteed renewable policy you will lock in to the rates and benefits more cheaply than if you wait. With this type of coverage the company can never change your benefits or increase your rate.

While in residency females can often qualify for and obtain unisex rates saving up to 20% on current and future premium.

Specialty specific true own occupation is a must for physicians (to my knowledge only two companies are offering true own occ to age 65 for all specialties). This benefit allows you to work in another occupation or medical specialty and still collect your benefit.

Residual or Partial disability allows you to return to work and still collect a benefit if your income has dropped due to disability.

Future increase option is also very important. The amount of coverage you can purchase is determined by your income. This option allows you to purchase increases in coverage as your income increases without proving health or insurability. All you have to prove is income.

Cost of Living Adjustment is very valuable if you are disabled for a long period of time your benefits will increase with the consumer price index keeping your monthly benefit level with inflation.

Lifetime benefits (only one company currently offers) If you become disabled young and have not had time to save for retirement this can be really valuable. Most companies pay to age 65-70.

And while Northwestern Mutual is a good company their contract currently is second only to Guardian/Berkshire

 

[macdaddy23]

Standard Insurance company also offers own occupation insurance for ER physicians.

 

[Hawkeye Kid]

12R....

if you don't mind telling, can you give us an idea of what all this will cost? i talked with a guy from NW mutual a few months ago but at the time was worried about paying the mortgage, etc more than long-term planning. now that that stuff has settled out, i'm thinking more like you obviously have been.

also, what are the thoughts on the strategery of getting a decent life insurance policy now as opposed to post-residency? i'm single w/o (known) children and don't have much debt that won't go away if i die (assuming the 'rents can sell my house for what i paid). less important now than DI, but the NW guy also tried to sell me on this.

any thoughts are appreciated and will definitely contribute to my pathetically small knowledge base. thanks.

 

[12R34Y]

12R....

if you don't mind telling, can you give us an idea of what all this will cost? i talked with a guy from NW mutual a few months ago but at the time was worried about paying the mortgage, etc more than long-term planning. now that that stuff has settled out, i'm thinking more like you obviously have been.

also, what are the thoughts on the strategery of getting a decent life insurance policy now as opposed to post-residency? i'm single w/o (known) children and don't have much debt that won't go away if i die (assuming the 'rents can sell my house for what i paid). less important now than DI, but the NW guy also tried to sell me on this.

any thoughts are appreciated and will definitely contribute to my pathetically small knowledge base. thanks.

DI policy cost me about 1290/year or up to around 1900/year. can pay it quarterly, yearly, monthly.

if you are single and no kids wouldn't waste time with life insurance.

DI is uber important.

 

[macdaddy23]

I agree. Nobody single without kids should have life insurance and if someone's trying to sell it to you-- Run away.
They don't have your best interest in mind only their's.

Disability insurance on the other hand should almost be mandatory, but very tough to afford on resident's salary if not moonlighting.

DI policy cost me about 1290/year or up to around 1900/year. can pay it quarterly, yearly, monthly.

if you are single and no kids wouldn't waste time with life insurance.

DI is uber important.

 

[doctordi]

Couple of thoughts

I know Guardian (I am not sure about the others) offers graded premiums. This option allows you to lock into the coverage at a lower rate now, and the premiums will increase a little bit annually until you change to a fixed premium in the future. This option is offered with residents in mind and allows you to guarantee your future benefits and future insurability.

Standard does offer true own occ for er docs, surgeons etc but the rest of their contract is second to Guardian. No lifetime benefits, 2year mental health/ nervous disorder benefit period, cost of living increases cease upon recovery so a second period of disability your benefit reverts to the base benefit. The mental health thing may not seem like a big deal but disabling events that fall under this catergorie account for the second leading cause of disability.

Northwest Mutual does not offer the same own occupation as Standard and Guardian nwm's contract does not allow you to be at work in another occupation and still receive your benefits.

Feel free to contact me with any questions

 

[DrQuinn]

I signed a $2500 monthly benefit contract with NWMutual. I get a good 66% DI lifetime from my soon to be (3.5 weeks) employer, but wanted just a bit more. I signed up for the graduated payments whcih will increase in time, but I can lock it in at a certian rate anytime I want (just want the first few years of post residency to be as low cost as possible). I would definately recommend it. I mean, dude, if I got injured where I couldn't work, my wife and I would be in deep dog doo doo, since we'll probably end up buying a 600-700k place in the DC area (and this AIN"T a mansion, trust me), plus my school loans, plus hers, plus... augh.

I woudln't look into it until you are a senior resident, IMHO.

Q

 

[socks123]

does it matter which salesperson you get the disability insurance from? are all the rates and the riders you get pretedetermined rates, or can getting the same insurance policy from a different salesperson differ in the price?

thanks

 

[12R34Y]

I signed a $2500 monthly benefit contract with NWMutual. I get a good 66% DI lifetime from my soon to be (3.5 weeks) employer, but wanted just a bit more. I signed up for the graduated payments whcih will increase in time, but I can lock it in at a certian rate anytime I want (just want the first few years of post residency to be as low cost as possible). I would definately recommend it. I mean, dude, if I got injured where I couldn't work, my wife and I would be in deep dog doo doo, since we'll probably end up buying a 600-700k place in the DC area (and this AIN"T a mansion, trust me), plus my school loans, plus hers, plus... augh.

I woudln't look into it until you are a senior resident, IMHO.

Q

Quinn,

got to majorly hugely unbelievable DISAGREE WITH YOU HERE!!!

wait until your senior year??!! for DI?


With DI you can get 3500/month for life or 65 y/o if you are injured DURING residency.

You precisely DONT want to wait until you are done.

You qualify based on health and age. you can lock in your rates forever AND qualify.

say you get injured.....you'll never GET DI when you are done. So what if something happened to you during your first year of residency? your wife and you would still have been screwed right?

At least you could have gotten 42,000 bucks/year tax free forever. that's something as opposed to no money.

sorry to rant, but after doing my homework you have to get DI when you can as soon as possible.

later and congrats on finishing up residency!!!!

 

[doctordi]

Socks

The company determines the rates it does not matter who you buy from the exact same policy from two different brokers will be the exact same price. If one person is offering you a cheaper policy you are giving up something in the area of benefit.

with that said

Brokers who do a lot of disability sometimes have the power to offer unisex rates for females which would save them money on their premium for the exact same policy written at female rates. This has to be set up by a broker through the program the is insured is affiliated with.

You want to work with someone who knows DI. Alot of people can and do sell DI but few people specialize in it. I would suggest working with a disability income specialist or DIS.

 

[whasupmd2]

I know this will vary quite a lot depending on need, etc. But what's a good amount to be covered (pay out) and premium cost both during residency and then afteward. Thanks for your help everyone. I'm about to purchase some.

Socks

The company determines the rates it does not matter who you buy from the exact same policy from two different brokers will be the exact same price. If one person is offering you a cheaper policy you are giving up something in the area of benefit.

with that said

Brokers who do a lot of disability sometimes have the power to offer unisex rates for females which would save them money on their premium for the exact same policy written at female rates. This has to be set up by a broker through the program the is insured is affiliated with.

You want to work with someone who knows DI. Alot of people can and do sell DI but few people specialize in it. I would suggest working with a disability income specialist or DIS.

 

[doctordi]

I know this will vary quite a lot depending on need, etc. But what's a good amount to be covered (pay out) and premium cost both during residency and then afteward. Thanks for your help everyone. I'm about to purchase some.

As a resident with little income most companies will write you between $3500-4000 monthly benefit. You should combine this with a future increase option that will guarantee your insurability when you get out. When your income increases you should increase as much as they allow as early as possible. The longer you wait the more expensive the increases will be. As far as premium this varies so much from person to person that I could not begin to tell you what it would be without more information.