A Crucial Safety Net for Doctors and Other High Earners
Long-term disability insurance is a crucial safety net for health care professionals, especially those in physically and cognitively demanding medical specialties. As a health care provider, the ability to perform your duties can be impacted by both physical and cognitive impairments, making it essential to have robust disability coverage. Here’s a comprehensive guide on how to buy long-term disability insurance, based on expert insights.
But First, A Disclaimer of Sorts
We are lawyers for long-term disability claimants. We have the largest long-term disability practice in our region, and have helped health care providers and other professionals across the country navigate the long-term disability claims and, when necessary, fight the insurance companies in court.
We don’t sell long-term disability insurance. Obviously, we are not insurance brokers or agents. Having handled thousands of claims over twenty-five years, we have a unique perspective on how to buy a good long-term disability insurance policy. Frankly, most brokers and agents, true experts in their field, have never seen the “inside” of a long-term disability insurance claim.
Every year we get many referrals from agents and brokers, because they know of our experience.
Thus, the information here is based largely on our extensive claim experience.
Understanding the Importance of Individual Policies
Individual long-term disability insurance policies generally provide better benefits compared to group policies offered by employers or associations. One of the primary advantages of an individual policy is its portability. This means that if you switch jobs or move to a different practice, your coverage goes with you. Additionally, benefits from individual policies are usually non-taxable, provided you pay the premiums yourself. This is a significant financial advantage if you ever need to make a claim.
Evaluating Group Policies
Group policies are typically offered as part of an employment benefits package. These policies are usually cheaper and do not require health underwriting, making them accessible to all employees regardless of their health status at the time of enrollment. However, group policies often come with limitations. They may include pre-existing condition exclusions, meaning any medical conditions you had before the policy started may not be covered. Additionally, these policies often offer shorter own-occupation coverage periods—usually only for the first two years. After that, benefits are only paid if you cannot perform any occupation, not just your own specialty. Furthermore, benefits from group policies are taxable if the employer pays the premiums.
The Pitfalls of Medical Association Policies
Association policies, like those offered by the American Medical Association, tend to provide the least favorable terms. These policies are often inexpensive and do not require medical underwriting, but they offer minimal benefits. Given the choice, it’s better to prioritize individual and group policies over association policies unless health issues prevent you from obtaining better coverage.
Navigating Elimination Periods
An elimination period in a disability policy is akin to a deductible in health insurance. It represents the amount of time you must wait before you start receiving benefits after a disability occurs. The length of the elimination period can significantly affect your premiums. Longer elimination periods result in lower premiums but may not be practical if you don’t have substantial savings to cover the gap. When choosing an elimination period, consider how long you can sustain yourself financially without an income.
Dealing with Pre-existing Conditions When Buying a Disability Policy
When applying for an individual disability insurance policy, it’s crucial to be completely honest about your medical history. Insurers will find out about past health issues, and failing to disclose them can lead to denied claims. Depending on your health history, insurers might exclude certain conditions from coverage or impose waiting periods before coverage kicks in for those conditions. A good broker can help you find policies that minimize the impact of pre-existing condition exclusions.
Understanding Partial or Residual Disability Provisions
Partial or residual disability coverage is an essential feature in many disability insurance policies. This provision allows you to receive benefits if you can still work part-time but suffer a significant income loss due to disability. For example, if you are a surgeon who develops a condition that prevents you from performing surgeries but allows you to continue with a limited clinical practice, partial disability coverage would compensate for the loss in income from no longer performing surgeries.
Consulting a Specialist
Given the complexity of long-term disability insurance policies, consulting with a specialist can be invaluable. The BenGlassLaw long-term disability claim team, lawyers who specialize in disability insurance, can help you navigate the nuances of different policies. We can assist in understanding policy details, ensuring you get the best coverage for your needs, and advising on claims processes. Our team can help you understand what documentation and medical records you need to support a claim, making the process smoother and increasing the likelihood of a successful claim.
Conclusion
Buying long-term disability insurance is a critical step in protecting your future. Start by evaluating individual policies for their superior benefits and portability. Consider group policies for their cost-effectiveness but be aware of their limitations. Association policies should be a last resort. Pay close attention to the elimination period and ensure it aligns with your financial situation. Always disclose your full medical history when applying for coverage to avoid complications with claims. Finally, seek the advice of long-term disability claim specialists to ensure you have the best possible coverage tailored to your specific needs. Taking these steps will provide peace of mind and financial security should you ever need to make a claim.
More Long-Term Disability Claim Information from BenGlassLaw
