Best Disability Insurance Policies for Physicians

Protect your income and financial stability as a physician with disability insurance.

Key Terms

  • Disability insurance rates for physicians can vary based on coverage amounts and location.
  • With own-occupation coverage, physicians can receive insurance benefits even if they work another job after becoming disabled.
  • This article highlights the importance of disability insurance for physicians and provides information on the types of disability insurance available, factors to consider when selecting a policy, and tips for buying disability insurance.

As a physician, you are likely well aware of the importance of maintaining your health. However, even the most careful and diligent medical professionals can be struck by illness or injury. If you become disabled and are unable to work, disability insurance will provide you with much-needed financial support. 

The way disability insurance works is that it pays you a portion of your income when you’re unable to work due to a covered reason. This can include physical injuries, mental health conditions, chronic illnesses, and more, that prevent you from being able to perform the duties of your job.

Why is disability insurance important for physicians?

As a physician, your ability to work is crucial to your financial well-being. Medical professionals earn high incomes, often have high levels of student debt, and may also have significant expenses, such as a mortgage. If you suffer an illness or injury that prevents you from being able to work, your income could be significantly reduced — or eliminated altogether. Disability insurance ensures that you have the funds you need to get through a difficult time.

Additionally, the risk of disability may be higher for physicians due to the physically and emotionally demanding nature of the work. Long hours and high levels of stress can take a toll on your health, increasing the likelihood of becoming disabled, which is why it’s important to have a policy net in place. 

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Types of disability insurance for physicians

Many medical professional organizations, such as state medical societies, offer group disability insurance to their members. This type of insurance is typically inexpensive, since its cost is subsidized, however it tends to come with limited benefits and coverage options. 

That’s why as a physician you should consider buying your own private or individual disability insurance policy. You can buy this directly from an insurance company or broker and tailor it to meet your specific needs and budget. Individual policies cost more than group policies, but they offer much more flexibility and customization. (Find out why else your group plan may not be enough.)

You’ll want to make sure to buy a long-term disability insurance policy, which provides financial support for an extended period of time. It’s designed to cover more serious disabilities that may prevent you from returning to work for years, even decades, lasting until you retire. (Short-term disability insurance, which pays benefits for several months, usually isn’t worth it; the premiums are expensive, and physicians can typically self-insure, or cover their lost wages for a few months on their own.)

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The best disability insurance for physicians

Disability insurance typically costs 1% to 3% of your income.

Disability insurance premiums will cost slightly more for women. It’s always best to talk to a licensed insurance broker, who can help you find a policy that’s best suited to your needs, circumstances, and finances. (They often have deep knowledge of discounts, too.)

How to choose the right disability insurance company

When selecting a disability insurance policy, it’s important to consider your specific desires and budget. Some factors to consider include:

  • The length of the benefit period: Choose a policy with a benefit period that aligns with your financial needs and goals. If you have a long-term disability, you may want a policy with a longer benefit period.
  • The amount of the benefit: Consider the amount of income you will need to maintain your standard of living if you are unable to work. Choose a policy with a benefit amount that will cover your expenses.
  • The waiting period: The waiting period is the amount of time you must wait before the policy begins paying out benefits. Choose a policy with a waiting period that aligns with your financial needs and resources.

3 things physicians should know about buying disability insurance 

Your specialty can affect the rates 

Disability insurance companies may treat physicians differently based on their medical specialties. For example, dermatologists or pediatricians may pay lower premiums compared to anesthesiologists, surgeons, and physicians who work in the ER. 

Get true own-occupation coverage

It’s important to choose a policy that defines disability in a way that meets your needs. Some policies may only cover disabilities that prevent the policyholder from performing their specific job duties, while others may cover any occupation. Physicians can benefit greatly from an own-occupation policy (as opposed to any-occupation). Under this policy, you’re considered disabled if you can’t do your main job. If you can still work another job, like teaching, for example, you’d still qualify to receive disability insurance benefits. 

Your policy is portable 

When you buy individual long-term disability insurance, it stays with you wherever you go. That means you’re still covered (so long as you keep paying the premiums) when you switch jobs, lose your job, or become self-employed.  

Customize your policy with riders

Riders are add-ons to your base policy. They can allow you more benefits and coverage, usually for a cost, though some are included for free. 

Here are a few disability riders that dentists can consider adding to their policy:

  • Future increase option: You can increase your benefit in the future as you age, without undergoing a medical exam. 
  • Student loan rider:  Many dentists have significant student loan debt, which can be difficult to manage on a reduced income.
  • Residual benefits: This type of rider can provide physicians with partial benefits if they’re unable to work at their full capacity due to illness or injury.
  • Waiver of premium: Some policies include a waiver of premium feature, which means that the policyholder will not have to pay premiums while they are receiving benefits. This can be a helpful feature, since it allows you to focus on your recovery without worrying about paying premiums.

Talk to an independent agent

Joshua Holt is a licensed insurance agent (License #2785989) and founder of Biglaw Investor and Sidebar Insurance LLC, an insurance agency created by lawyers, for lawyers. His insurance expertise lies in the areas of life and disability insurance, particularly covering lawyers, doctors and other high-income professionals. Prior to Biglaw Investor, Josh practiced private equity mergers & acquisition law for one of the largest law firms in the country.

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