Long-term disability insurance

[flerfmcgerf]

Hi there,

My employer does not provide long-term disability insurance. I picked some up when my first kid was born, that I've been paying for, but it seems a little pricey. I saw The Trust offers long-term disability insurance underwritten by "Liberty Life Assurance Company of Boston, a Lincoln Financial Group Company." It seems to be about half the price of what I'm paying for (same waiting period, benefit amount, duration) - can anyone offer any guidance on whether this seems like a reasonable way to go for long-term disability? Things I should be looking out for when evaluating it? Other options you use?

Thanks!

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[PsyDr]

You want "own occupation" insurance, NOT "any occupation".

1) "Own Occupation" insurance insures you against the possibility that you can't work in your own occupation (i.e., psychologist).
2) "Any Occupation" insurance insures you against the possibility that you can't work in ANY occupation (e.g., grocery stocker).

 

[foreverbull]

I can’t speak to their disability insurance, but I bought Lincoln’s life insurance via the Trust—also a better deal than my local credit union and other companies could offer.

The downside is Lincoln is still in the dark ages and doesn’t have an online portal. Still have to send paper checks each year via snail mail and fill out paper applications. Took a few months to get started, if I recall.

 

[MD Financial Services Scott]

Hi there,

My employer does not provide long-term disability insurance. I picked some up when my first kid was born, that I've been paying for, but it seems a little pricey. I saw The Trust offers long-term disability insurance underwritten by "Liberty Life Assurance Company of Boston, a Lincoln Financial Group Company." It seems to be about half the price of what I'm paying for (same waiting period, benefit amount, duration) - can anyone offer any guidance on whether this seems like a reasonable way to go for long-term disability? Things I should be looking out for when evaluating it? Other options you use?

Thanks!

Just an observation about that Trust product, you might review a few issues that jump out to me:

1: You must be totally disabled for 6 months to become eligible for a partial claim. "For eligible claimants, this benefit provision encourages a person receiving benefits to gradually return to work without losing disability benefits. If, immediately following a period of total disability which has lasted 6 months or longer, you return to work but your earnings are less than 75% of pre-disability average earnings"
So if you are not totally disabled, you cannot get partial benefits? Where this comes into play is if you are out doing PT, OT, Speech, cancer treatment or the such a few days a week and that causes you to not be able to work some but not at 100% there is not a claim because you were not out Totally for 6 months.... What happens if you were working 60-75 hours like most doctors and you get told to slow down to only 40, still a full time job, certainly an impact to your income but you are not totally disabled thus not on claim....?

2: It never defines your occupation. Is your occupation your specialty or as a doctor? What happens if you can't do your specialty and go work in something else do they take away benefits or stop them all together, maybe never start them? Can they ever tell you what 'other job' that you should go do at some point?

3: This is their last statement: "The descriptions here are necessarily brief and are subject to provisions that can only be expressed completely in the certificates of insurance which are available upon request and which will be sent to you when coverage begins." I would probably request before you buy so you know what you are signing up for.

Just my thoughts.

 

[AbnormalPsych]

I'm looking into long term own occupation, with several other specific riders. I see a lot of independent agents that serve medical docs. Anyone have recommendations for independent agents that work with psychologists?

 

[MD Financial Services Scott]

Don't know anyone that focuses their practice working only with psychologists but as a psychologist you will have access to the same discounts MD's, DO's, DDS, DVM's.

 

[flerfmcgerf]

You want "own occupation" insurance, NOT "any occupation".

1) "Own Occupation" insurance insures you against the possibility that you can't work in your own occupation (i.e., psychologist).
2) "Any Occupation" insurance insures you against the possibility that you can't work in ANY occupation (e.g., grocery stocker).

And I guess, at least for some insurers there's "True Own Occupation" which allows you to keep working in a different job, while still getting the full benefit because you can't work as a psychologist. I've got that now and wonder if that's why my premiums are as high as they are.

 

[MD Financial Services Scott]

The true own occupation has a cost of an additional 12-18% so it certainly contributes to the higher cost. My comment for psychologists is always what occupation can you do but still could make the case to the carrier that you cannot do Psychology? It is easy if someone is a surgeon because a hand tremor could put you out of work but still would be able to many other jobs thus a true own specialty definition is key.
Hope that helps.

 

[AbnormalPsych]

The true own occupation has a cost of an additional 12-18% so it certainly contributes to the higher cost. My comment for psychologists is always what occupation can you do but still could make the case to the carrier that you cannot do Psychology? It is easy if someone is a surgeon because a hand tremor could put you out of work but still would be able to many other jobs thus a true own specialty definition is key.
Hope that helps.

This is a good point. I'm guessing things related to impaired cognition or ability to produce speech. Otherwise I could see that being a difficult case to make.

 

[MD Financial Services Scott]

I think in PSY, many folks could use an Own Occupation Not Engaged definition just fine. You can look at your contract and sometimes you can pull the True Own Occupation rider off thus dropping your price as well if that is of interest to you.

 

[Sanman]

The true own occupation has a cost of an additional 12-18% so it certainly contributes to the higher cost. My comment for psychologists is always what occupation can you do but still could make the case to the carrier that you cannot do Psychology? It is easy if someone is a surgeon because a hand tremor could put you out of work but still would be able to many other jobs thus a true own specialty definition is key.
Hope that helps.

This conversation has me curious how they define occupation as well. If I suffer some cognitive issues and struggle to a business/ large practice, but could function as a therapist with a significant pay drop does that exclude me from disability insurance payout?

 

[WisNeuro]

This conversation has me curious how they define occupation as well. If I suffer some cognitive issues and struggle to a business/ large practice, but could function as a therapist with a significant pay drop does that exclude me from disability insurance payout?

If the cognitive issues are really bad, you should have no problem with that disability eval. If the cognitive issues aren't that bad, you should have no problem convincingly sandbagging that disability eval.

 

[Sanman]

If the cognitive issues are really bad, you should have no problem with that disability eval. If the cognitive issues aren't that bad, you should have no problem convincingly sandbagging that disability eval.

Lol, fair enough. Some of the long covid issues being reported have had me thinking about how I want to insure myself should I not be firing on all cylinders. Some reports about significant issues for white collar folks and with more calls for face to face work to resume I am weighing my options.

 

[MD Financial Services Scott]

Every contract is different on their language, most of the Big 6 carriers if you have the best definition is pretty clear but if you are talking about employer provided plans or medical association plans then really read them carefully. Some of those have an "Any Occupation" clause, some use Department of Labor to determine your occupation and so on. I know it is dull reading but always read the definition of the elimination period, in other words what constitutes a day. Definition of Disability, how the contract defines eligible income, any Income Benefit Offsets and if the carrier has the right to change the language in the policy or to cancel it. Once you know those issues you will be in pretty good shape to make an informed decision if that contract has the language to meet your expectations of performance at claim time.