Specialty Specific Disability Insurance

No doubt, no question, and with TOTAL and COMPLETE CERTAINTY, the very top question asked by all medical residents and fellows when looking for their first individual disability insurance policy is:

“Is the policy Specialty Specific?”

In reality, this question makes no sense…in no disability insurance policy will you find language to provide “SPECIALTY SPECIFIC” benefits. It doesn’t exist in those terms.  YES, there is language in a handful of policies including Guardian, The Standard, Ameritas, Ohio National that can be added to include the single word “specialty” to help further define one’s occupation. So, why do we find so many asking us or searching google for this phrase?

Practically speaking, including “specialty” language can be critical… it’s the number one requirement for surgical or any invasive trained medical specialists. All such physicians want to make sure that they are getting what their father, older colleague, peer, or program coordinator tells them they need, and so, they start with the “specialty-specific” piece. Let’s dive into what the purpose is of the Own Occupation rider and build this magical word, SPECIALTY, into it to see the difference.

First, the basic definition of a disability insurance policy is the inability to perform the material and substantial duties of one’s occupation and an inability to be gainfully employed. The gainfully employed piece is what prohibits someone from earning any other income doing anything at all and can be quite restrictive, especially for a trained physician who may be able to pivot and earn other income doing different things than originally educated to perform.

Second, we can add an Own Occupation rider to a policy to remove the gainfully employed language. This opens it up to allow a physician who may be derived the majority of income from surgery prior to a disabling event and now can only work in a clinical setting. The clinical income WOULD BE ALLOWED under an Own Occupation definition. The question at hand becomes defining what actually is the “PHYSICIAN’S OCCUPATION”.

At the time of a qualifying disability, Your Occupation is based on the substantial and material duties that you are working in right before the disability began. To determine the substantial and material duties, most companies, such as Principal Life, take into account such factors as the specific duties, the amount of time, and the amount of income derived from the duties.

If you are a physician or surgeon and the occupational analysis shows that just prior to disability the main duties, are for example, performing surgery and the majority of your office base practice was pre and post operative patients, for the claim Your Occupation would be considered to be a surgeon.  Again, a carrier like Principal would also recognize other specialties and sub-specialties if the analysis would bear out that the main duties would show that a person was limited to those duties associated with a specialty or sub specialty. Examples of these would be radiologist, cardiologist, oncology, anesthesiologist and the other specialties and sub specialties recognized by such groups as the American Board of Medical Specialties, American Osteopathic Association, or the American Dental Association. 

What this means is, if you have an Own Occupation rider, and if it is determined that you were unable to perform the substantial and material duties of Your Occupation but, you choose to work in another occupation, you would be considered to be Totally Disabled and the maximum monthly benefit would be paid, subject to the terms of the policy.

Ok, whew, that was a lot…we demonstrated that if you add an Own Occupation rider that defines your occupation as consisting of the material duties performed prior to a disability, you would qualify for benefits EVEN IF you could earn other income performing other duties! BUT, wait; I didn’t mention anything about SPECIALTY or SPECIALTY SPECIFIC!!!!!

Ok, let’s add this piece…

In some contracts, there is an additional sentence that says “IF YOU HAVE A DEFINED SPECIALTY IN THE AREAS OF MEDICINE OR LAW, WE DEEM THAT SPECIALTY TO BE YOUR OWN OCCUPATION.”

Boom!!! That’s it!! That is “SPECIALTY SPECIFIC” defined in a single sentence. The argument here is that some prefer to see this magic word in the policy itself. In reality, Guardian added the sentence sometime back in the 1980’s and charged a bunch more for this new “Specialty Own Occ” definition and got most surgeons and physicians to buy their policy. Unum soon followed and those 2 owned the physician disability insurance marketplace for decades until Unum merged with Paul Revere and Provident and stopped selling their specialty contracts. Others such as The Standard, Ohio National, Ameritas have jumped in the game by including the Specialty sentence and they all price the policies accordingly.

Defining occupational duties is the key…is it recognized by the AMA, your peer group, and insurance carriers who have been selling disability insurance policies and administering claims for decades recognize that the daily duties that lead to earned income differ from a diagnostic radiologist to an OB/GYN? Are they different from an Orthopedic Surgeon to an Internist?  Are they different from an Allergist to a Dermatologist? Yes, of course they are. Should a carrier care if you call yourself a “SPECIALIST” as it relates to paying your claim for disability insurance? Arguably, NO!!! The only thing that should really matter at all is if you CAN or CAN’T perform the exact income generating duties that you were doing just before the disabling event.

Now, does that mean you shouldn’t buy a policy to include SPECIALTY own occupation language?? Of course NOT! In fact, after comparing policies, own occupation riders, building benefits in each policy from each carrier as similarly as possible…if you can have the specialty definition, why in the world WOULDN’T you include it??? You should!!! It’s peace of mind well worth considering.

At the end of the day, just know there is no such thing as “SPECIALTY SPECIFIC DISABILITY INSURANCE”. There are individual policies that include Specialty Own Occupation definitions that may provide a bit more comfort beyond defining your own occupation as the duties performed at the time of disability. Fortunately for all InsureSTAT clients, we have all policies and can show you how they compare and protect you…you are the only one who matters anyway, not an article, sales piece, or your local insurance agent.

Danny Mensh is the CEO of InsureSTAT, the leading online provider of Disability Insurance for Physicians, Nurses and Physician Assistants.

Danny Mensh

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