Do I Have the Own Occupation Coverage I Think I Do? Part I
We’ve talked before about the importance of professionals choosing true own occupation policies that allow policyholders to be totally disabled and collect full benefits—even if they are working in another occupation.
That being said, if you are going to pay higher premiums for “own occupation” coverage, it is also important to ensure that you are actually receiving the benefit set-up you are looking for, and simply checking the box for “own occupation” is no longer enough.
As disability policies have evolved over time, some insurers have created “own occupation” riders that are specific to the medical field. However, in some instances these riders have become so hyper-technical and convoluted that you may be better off with something that is more simple, unless the framework in question is particularly relevant to your practice and field of medicine.
Let’s look at a few examples. Can you tell which excerpt below is from a “medical own occupation” rider?
GUARDIAN POLICY
Total Disability or Totally Disabled means that due to Injury or Sickness, You are no able to perform the material and substantial duties of Your Occupation.
Your will be Totally Disabled even if You are Gainfully Employed in another occupation so long as, solely due to Injury or Sickness, You are not able to work in Your Occupation.
NORTHWESTERN MUTUAL POLICY
Total Disability or Totally Disabled. The words “Total Disability” or “Totally Disabled” mean the Insured is unable to perform the substantial and material duties of the Regular Occupation.
If the Insured can perform one or more of the substantial and material duties of the Regular Occupation, the Insured will be considered Totally Disabled if:
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- The Insured is not Gainfully Employed in an occupation;
- More than 50% of the Insured’s time in the Regular Occupation at the time Disability began was devoted to providing direct patient care and services; and
- The Insured is unable to perform the substantial and material duties which accounted for more than 50% of the Insured’s charges for direct patient care and services as evidenced by the Billing Codes for the 12 months before the Disability began.
If the Insured can perform one or more of the substantial and material duties of the Regular Occupation and is not considered Totally Disabled, the Insured may qualify as Partially Disabled.
The answer is the Northwestern Mutual (NML) policy and the rider is an example of how policies marketed specifically to doctors can be more complicated than you might expect. Riders like the above are not unique to NML, and in fact Guardian itself has a variation of the above.
It is possible for physicians to collect under these riders, but the process has more steps and can cause problems for physicians who are expecting a straightforward disability claim and are not aware of the additional considerations that come into play with these riders.
Our next post will further delve into how definitions of total disability can be complicated under newer disability policies.
