Who are people using for Disability Insurance, particularly those graduating residency this year?
PM&R Disability Insurance
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I have northwestern mutual with all the bells and whistles
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Make sure you get specialty specific insurance. Some insurance plans will not cash out if you a pain doctor that develops hand issues because you can still talk to patient(be a doctor in some capacity). Other plans will pay the perceived difference in lost income.
Nowadays a lot of salesmen will be able to sell you a policy over the internet. A home health nurse will contract out and come to your house to do the insurance physical which is basically vitals, labs.
I am more old fashioned so I went with a local broker in the city I lived in at the time (PM me for detail) but I liked the guys I went with. Not too pushy and didn't try to make me buy whole life insurance which is what a lot of thes guys will try to do.
I will say this Re: an insurance physical. Your health numbers will make a big difference in the amt you pay, meaning try and get into good shape before you get your exam.
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As Xardas mentioned. There are plenty of places you can buy it online. Go with one that helps you decide on the best option for you, but still shows you multiple options. You never know if there is an alterior motive behind the recommendation so it doesn't hurt to verify yourself.
To simplify, you can pretty much split up most of the major insurance carriers into a top-tier and lower-tier category. In my opinion, Guardian, Standard and MetLife are going to offer the best policies out there (in most states) and Guardian's Limited policy, Principal, Ameritas and MassMutual will fall in the second-tier. They are all really great policies and all offer a True Own-Ocupation definition of total disability (in most states), but will differ in some other features like the residual benefit, COLA, benefits for mental/psychiatric conditions, etc.
To simplify, you can pretty much split up most of the major insurance carriers into a top-tier and lower-tier category. In my opinion, Guardian, Standard and MetLife are going to offer the best policies out there (in most states) and Guardian's Limited policy, Principal, Ameritas and MassMutual will fall in the second-tier. They are all really great policies and all offer a True Own-Ocupation definition of total disability (in most states), but will differ in some other features like the residual benefit, COLA, benefits for mental/psychiatric conditions, etc.
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Hello,
I have an own occupation policy with Principal. Around this time last year, they had a special plan for trainees who were graduating with good rates. So, you may want to check with an agent who works with this carrier. The rates for Standard for a female client were decent also.
My husband (anesthesiologist) has a good own occupation policy with Ameritas (which was the best we would find when compared to Guardian, Principal, Standard).
I have an own occupation policy with Principal. Around this time last year, they had a special plan for trainees who were graduating with good rates. So, you may want to check with an agent who works with this carrier. The rates for Standard for a female client were decent also.
My husband (anesthesiologist) has a good own occupation policy with Ameritas (which was the best we would find when compared to Guardian, Principal, Standard).
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As you likely already know, the COLA rider is needed in order for your monthly benefit to increase during a claim. The intent is to keep pace with adjustments in the cost of living, or inflation, so that your disability insurance benefit maintains its purchasing power in the event of a long term claim.
So the question is, how long would you be receiving benefits if you were to become permanently disabled today? I think the easiest means of making a decision is determining the risk at hand. This rider is considerably more valuable for a 30 year old than a 60 year old simply because the risk and potential reward is much greater.
Assuming a 3% inflation rate – in 30 years, $10,000 will only be worth the equivalent of ~$4100 in today’s dollars. Likewise, one would need ~$24,000 in 30 years to have the equivalent of $10,000 in today’s dollars.
Those are big numbers and while the probability of you becoming permanently disabled may be low, the financial risk (which is why you buy disability insurance in the first place) can be tremendous. In my opinion, younger individuals should have the COLA rider on their policies. As you get older and develop more financial freedom, you can always remove that rider. For those who decide to purchase two policies, you can always include it on one and not on the other.
That said, I sell disability insurance for a living, so I guess you could say there is a conflict of interest. Good luck.
So the question is, how long would you be receiving benefits if you were to become permanently disabled today? I think the easiest means of making a decision is determining the risk at hand. This rider is considerably more valuable for a 30 year old than a 60 year old simply because the risk and potential reward is much greater.
Assuming a 3% inflation rate – in 30 years, $10,000 will only be worth the equivalent of ~$4100 in today’s dollars. Likewise, one would need ~$24,000 in 30 years to have the equivalent of $10,000 in today’s dollars.
Those are big numbers and while the probability of you becoming permanently disabled may be low, the financial risk (which is why you buy disability insurance in the first place) can be tremendous. In my opinion, younger individuals should have the COLA rider on their policies. As you get older and develop more financial freedom, you can always remove that rider. For those who decide to purchase two policies, you can always include it on one and not on the other.
That said, I sell disability insurance for a living, so I guess you could say there is a conflict of interest. Good luck.
Is there a difference between "own occupation" and "regular occupation"? I'm looking at a Principle policy. I don't have the legalese available yet, but I wanted to make sure I was on the right track. My sales guy says when it comes to writing the policy I can be very specific about my job duties, and that if I can't do those I can qualify for payment. Not that I hope to ever need it, of course. Thanks.
My thoughts. COLA rider is huugge... Inflation is only rising - food is getting more expensive. Water is the next precious resource.. that will make everything more expensive. Everything is getting more expensive. If you are actually disabled your costs keep going up and up. Get it.
Re: the own vs regular occupation read the fine print and really go over it with the company. If for example you end up losing the ability to do work as a physiatrist, e.g. lots of standing, walking, bending to examine pts etc... then i want the ability to retrain and do something else yet still get disabiloty, e.g. become a psychiatrist etc.
Thats why I liked Guardian's policy so much. Its physician friendly and anticipates all the worries that physicians have.
I also liked Future option increase. Since I was younger whne I got mine my income was way lower so I could only afford so much; I'm employed now so i haven't taken advantage of it but if I ever go private again, I don't need another exam and such to increase my coverage.
Getting a second exam may not sound like a big deal when you're in your 20s but trust me when you are in your late 30s early 40s and you are in the doctors lounge talking you will be quite surprised how many of your colleagues have picked up various medical issues - not necessarily big deals now but a big deal in the insurance underwriting world. Makes a big difference.
Re: the own vs regular occupation read the fine print and really go over it with the company. If for example you end up losing the ability to do work as a physiatrist, e.g. lots of standing, walking, bending to examine pts etc... then i want the ability to retrain and do something else yet still get disabiloty, e.g. become a psychiatrist etc.
Thats why I liked Guardian's policy so much. Its physician friendly and anticipates all the worries that physicians have.
I also liked Future option increase. Since I was younger whne I got mine my income was way lower so I could only afford so much; I'm employed now so i haven't taken advantage of it but if I ever go private again, I don't need another exam and such to increase my coverage.
Getting a second exam may not sound like a big deal when you're in your 20s but trust me when you are in your late 30s early 40s and you are in the doctors lounge talking you will be quite surprised how many of your colleagues have picked up various medical issues - not necessarily big deals now but a big deal in the insurance underwriting world. Makes a big difference.
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Principal's Regular Occupation rider is still going to function like a True Own-Occupation definition of total disability. With that particular carrier, you just need to be sure that it is added as an optional rider, otherwise it is not the same.
Your agent is partially correct. Truth be told, you can put as much detail as you'd like on your application, but it will only be important at the time of application for the purpose of evaluating the Occupation classification for which you qualify. If you read the actual contract, it will state something like:
"Total disability means, solely due to injury or illness, that you are not able to perform the material and substantial duties of your occupation. YOUR OCCUPATION is further defined as the occupation in which you are gainfully employed during the 12 months prior to the time you become disabled."
So, you can be as specific as you'd like, but a claim will be judged based on the duties you are actively performing at the time of the claim. It should end up being similar duties of course, but not always.
I'm not sure of what state you live in, but you may want to review your options with other companies too. Principal is a fine option, especially if your agent has a discount for you, but there are other options which provide better contracts and may not be much more costly.
Your agent is partially correct. Truth be told, you can put as much detail as you'd like on your application, but it will only be important at the time of application for the purpose of evaluating the Occupation classification for which you qualify. If you read the actual contract, it will state something like:
"Total disability means, solely due to injury or illness, that you are not able to perform the material and substantial duties of your occupation. YOUR OCCUPATION is further defined as the occupation in which you are gainfully employed during the 12 months prior to the time you become disabled."
So, you can be as specific as you'd like, but a claim will be judged based on the duties you are actively performing at the time of the claim. It should end up being similar duties of course, but not always.
I'm not sure of what state you live in, but you may want to review your options with other companies too. Principal is a fine option, especially if your agent has a discount for you, but there are other options which provide better contracts and may not be much more costly.
Thanks for the replies!
MR, you mentioned for Principal to get a Regular Occupation reider as an optional rider for it to function like True Own-Occupation. Just wanted to be clear on what that means (optional as oppose to...)?
Also, what do you feel are the disadvantages of Principal that makes other providers more preferable?
MR, you mentioned for Principal to get a Regular Occupation reider as an optional rider for it to function like True Own-Occupation. Just wanted to be clear on what that means (optional as oppose to...)?
Also, what do you feel are the disadvantages of Principal that makes other providers more preferable?
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With Principal, the better definition of total disability needs to be added as a rider, opposed to being automatically included in the base contract as it would be with some other companies. There is really no contractual difference - I've just seen people forget to add it, which would create a difference.
Don't get me wrong, Principal is one of the carriers I include in my review for every client - they offer a great policy. That said, Principal has a few disadvantages:
- 24-month maximum benefit period for claims relating to mental/psychiatric conditions(might not be important to you, but these illnesses account for ~11% of claims). *This is only the case with their Regular Occupation rider, and can be avoided by selecting a Transitional Own Occ definition.
- Their COLA rider is a little inferior to some others.
- Their residual rider is slightly inferior to some others.
- While they offer a true own-occupation definition of disability, they do not include medical specialty wording. Regardless of whether that wording actually matters at claim time, many individuals simply prefer a policy that does have it.
Again, these disadvantages do not necessarily mean you shouldn't go with them. Shoot, if you're a female physiatrist with access to a multi-life discount through them, it probably looks realllly attractive. My point is simply this, if your circumstances are such that you find a contractually better policy for around the same price (within 5-10%) or sometimes even cheaper, it would make sense to take the better policy. Every circumstance is unique though so it won't always work out the same way. In some cases Principal will look realllly great and in others you would be better off elsewhere.
Hope that clarifies.
Don't get me wrong, Principal is one of the carriers I include in my review for every client - they offer a great policy. That said, Principal has a few disadvantages:
- 24-month maximum benefit period for claims relating to mental/psychiatric conditions(might not be important to you, but these illnesses account for ~11% of claims). *This is only the case with their Regular Occupation rider, and can be avoided by selecting a Transitional Own Occ definition.
- Their COLA rider is a little inferior to some others.
- Their residual rider is slightly inferior to some others.
- While they offer a true own-occupation definition of disability, they do not include medical specialty wording. Regardless of whether that wording actually matters at claim time, many individuals simply prefer a policy that does have it.
Again, these disadvantages do not necessarily mean you shouldn't go with them. Shoot, if you're a female physiatrist with access to a multi-life discount through them, it probably looks realllly attractive. My point is simply this, if your circumstances are such that you find a contractually better policy for around the same price (within 5-10%) or sometimes even cheaper, it would make sense to take the better policy. Every circumstance is unique though so it won't always work out the same way. In some cases Principal will look realllly great and in others you would be better off elsewhere.
Hope that clarifies.
Thanks for the clarification. I am female, so my agent recommended Principal because of the unisex discount available if there are at least three other residents at my institution with the policy. Hopefully that's the case as the other options were at least 50% more expensive.
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If he can get it for you, Physia, it would be a great deal! There are other carriers that have similar programs but much more selective. Even if your agent doesn't already have a discount set up, you can always create one if you have two colleagues who would also be interested in getting coverage through Principal.
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There are only a few True Own Specialty definition policies in the market place today. Those are Met, Guardian, Principal, Ameritas, Mass, Standard and Ohio. The key becomes who brings the best package for you based on your age, gender, medical specialty and State of residency. If we can help let us know. Scott
