Physicians reviewing their long-term disability insurance options need to confirm the policy contract contains a "true own-occupation" definition of disability.
True own-occupation means that you would be deemed disabled if you are unable to perform the material and substantial duties of your occupation (medical specialty) AND your benefits do not change even if you make an income (gainfully employed) in another occupation or specialty.
Essentially, the true own-occupation definition means that if you can’t work in your medical specialty but are able to work in another area, you’ll still be considered disabled and get your full benefit payout.
An example is a cardiovascular surgeon who can’t perform surgery but can still work as a general cardiologist or teacher. Even though they’re still working, the fact that they can’t work as a surgeon means they get paid the full benefit.
The most important aspect of a physician disability policy is the definition of disability. The true own-occupation definition is the strongest and provides the most flexibility to receive benefits when disabled.
There are a few other definitions of disability that are often confused with true own-occupation. Most insurance companies (except the "Big 6" insurance companies) will say they have "own-occupation" disability insurance, but contain one of the other definitions of disability:
- Transitional own-occupation: With this definition, your policy will pay benefits if you cannot work in another occupation and start earning income in a new occupation, but your total new income (including benefits) cannot exceed the total original earned income. If you make more with your new occupation than you did in your original occupation, your disability benefits will be offset until your total income is equal to the benefits plus your new income and is not higher than your income as a medical professional.
- Modified own-occupation: According to this definition, a person receives benefits when they can’t work in their own occupation and are totally disabled. However, benefits do not continue if that person wants to work earning an income in another profession. The options of a totally disabled person with this kind of disability insurance coverage would be to either live off their benefit check and remain totally disabled or return to full-time work in a different occupation.
- Any occupation: This is the most common form of disability insurance, and is usually found in employer-sponsored group long-term disability insurance plans and low-cost individual contracts. In this definition, an insured is considered disabled only if they are unable to work in any occupation for which they are qualified. This is the least beneficial type for the insured and it also provides the greatest leverage to the insurance company for determining claim eligibility. Someone with any-occupation coverage can only receive benefits for a claim if their injury or illness prevents them from working anywhere, not just in their specific occupation or another occupation for which they have qualifications.
True own-occupation is the only definition of disability insurance that we encourage medical professionals to purchase because it is the most comprehensive and will allow you the option of working in another field if you are unable to work in your medical specialty.
When shopping for a policy, getting a physician specific “own occupation” definition is always the first and most important thing to consider. If you are ready to get started with your own-occupation coverage policy today, fill out a quote request!