Published 12/1/2012
Nicole Dierking

Do You Need Disability Insurance?

If you rely on your income, you do!

As an orthopaedic surgeon, you see the impact of disabling injuries every day. Although you do your best to repair limbs mangled in motor vehicle accidents or by falls and trauma, you know that recovery can sometimes take months, even years. Consider these facts:

  • According to the National Safety Council, a disabling injury occurs nearly every second in the United States.
  • Nearly one in five Americans—54 million people—is classified as disabled, based on U.S. Census Bureau information.

Your ability to work and earn an income is your most valuable asset. And even if your hospital or practice provides group disability income insurance, the benefits provided may not be enough to protect you and your loved ones from the financial hardship that can result from a disabling injury.

Importance in your life
According to the American College of Physicians, most experts recommend you purchase a disability insurance policy that can replace at least 60 percent of your after-tax pay, or up to 80 percent if you can afford it. A disability that prevents you from participating in the practice or performing surgery could be devastating to your standard of living, savings, and peace of mind.

Robert Maben, MD, a general surgeon, knows how important disability income insurance is. Dr. Maben purchased an individual disability income policy in 1997, shortly after completing his residency. Five years later, he was diagnosed with Parkinson’s disease. As his disease progressed, Dr. Maben eventually had to give up surgery and was no longer able to practice medicine. He continues to face challenges in dealing with his disease. His disability income insurance policy, however, meant that he didn’t have to worry about a significant drop in income.

Employer- and government-provided disability coverages are often limited. Ask yourself whether your savings and investments would be sufficient to protect your way of life if you became disabled and unable to work. Disability income insurance can be the best way to protect your lifestyle against possible injuries and illnesses.

Help from the AAOS
The American Association of Orthopaedic Surgeons (AAOS) can help you achieve your goal of protecting your most valuable financial asset—your income. Under the AAOS Member Advantage Program, AAOS members in most states are eligible to apply for individual non-cancelable disability insurance and receive a 10 percent discount.

An individual disability income insurance policy helps you cover necessary living expenses if you have a qualifying disability, including the following: back problems, cancer, cardiac illnesses, injuries, mental or nervous disorders, nervous system disorders, other orthopaedic issues.

The coverage is noncancelable and has guaranteed premium rates to age 65. This means that the insurance carrier cannot change or cancel your policy, except for nonpayment of premiums, or increase your premium before you reach age 65, regardless of changes in your income, occupation, or health.

After age 65, you may still conditionally renew your policy annually for the rest of your life as long as you are working full-time and meet the policy requirements. If you conditionally renew your policy, your premium will change based on your age at renewal.

he maximum monthly total disability benefit is based on your current income and occupation when you purchase your policy. Once disabled under the terms of the policy, you must satisfy the policy’s elimination period before receiving benefits.

Policy features
The AAOS Individual Disability Income Insurance policy is unlike other disability insurance plans because of its unique program features, including the following (some policy features may vary by state):

  • Up to $15,000 per month in benefits, based on your income
  • “Own Occupation” definition of disability protects you if you are unable to work in your occupation (orthopaedic surgery), even if you elect to work in another occupation. Benefits are payable to the end of your benefit period as long as you remain unable to perform the duties of your regular occupation.

Built-in policy features and optional riders are available to help customize a policy to your specific needs. For example, the optional residual disability benefit provides partial benefit payments even if you are not totally disabled, if certain requirements are met. And the built-in cost of living adjustment is applied to your monthly benefit while you are disabled to help you keep up with inflation.

Other options include future increase opportunities, which may be available automatically to help keep your policy up-to-date without requiring additional underwriting, and a transitional occupation rider that includes disabilities due to mental or nervous disorders. Plus, benefits are income tax-free when you pay premiums with after-tax dollars.

More information
Even if you already have some disability income coverage through your practice or hospital, you should consider reviewing your coverage in light of your current circumstances. If you purchased your coverage some time ago, the benefits may not have kept pace with inflation or with your current income and lifestyle. Supplementing your present coverage with an individual disability income policy through the AAOS Member Advantage program can help ensure that you have adequate protection.

Learn how an Individual Disability Income Insurance policy can help protect your ability to work, earn an income, and maintain your current lifestyle and future financial plans. Visit www.aaosinsurance.com or call 866-679-0888 to speak with an AAOS Member Insurance Program Representative.

Nicole Dierking is a copywriter for the Pearl Companies.