When shopping for disability insurance, doctors need to look for a strong own-occupation definition of disability.
In our Guardian disability insurance review, we provide an overview of the key provisions and options that are available with this coverage.
Read on to learn more.
Guardian disability insurance policy basics
Does it have an own-occupation provision? Guardian has one of the strongest definitions of disability for physicians based on its own-occupation provision.
If totally disabled, you are able to receive your full disability insurance benefits even if you are gainfully employed in another occupation. In addition, you may be able to collect full benefits even if you can still practice your own specialty, but in a limited capacity due to a disability.
The company will consider you totally disabled if more than 50 percent of your income is from either hands-on patient care or surgical procedures and you can no longer perform those duties or procedures due to injury or illness.
Is the policy non cancelable or guaranteed renewable? The policy is non cancelable and guaranteed renewable to either age 65 or 67.
What is the maximum benefit period? You can purchase coverage to ages 70, 67, and 65. You can also elect 10-year, five-year and two-year benefit periods.
What elimination periods are available? The policy is available with the following elimination periods:
Does the policy pay benefits for mental disorders? Guardian does not have any mental/nervous limitations for most medical specialties in states other than California and Florida. Certain specialties do have a 24-month limitation on benefits for mental disability claims, including anesthesiologists, anesthetists (MD, DO & CRNA), emergency room physicians, and pain management physicians.
Cost-of-living adjustment (COLA) rider
Provider Choice offers three optional cost of living adjustment riders:
- One that increases benefits by a guaranteed 3 percent compounded annually
- One that increases benefits based on the Consumer Price Index, with a minimum 3 percent and up to a maximum of 6 percent annually
- One that delays COLA increases until the fourth anniversary of your disability, with benefits increases thereafter by 3 percent annually on a compound basis.
There is no cap on Guardian’s COLA Rider. Once disability benefits end, increases of $300 or more will be added to the policy’s monthly benefit without additional premium.
Residual disability riders
Guardian offers two types of residual disability riders:
- A Basic Partial Disability Rider
- An Enhanced Partial Disability Rider
Under the basic version, the requirements for being considered residually disabled include:
- A loss of earnings of at least 20 percent; AND
- You are able to perform some, but not all, of the substantial and material duties of your occupation; OR
- You are not able to work full time in your occupation;
You will be paid the following benefits under the rider:
- 100 percent of your policy’s monthly benefit for total disability if your loss of earnings exceeds 75 percent.
- An amount proportional to your loss of pre-disability income if it’s under 75 percent.
- A minimum of 50 percent of your policy’s monthly benefit for total disability for the first six months of residual disability.
Under the enhanced rider, to be considered residually disabled, you must incur a loss of earnings of at least 15 percent. You will be paid the following benefits under the rider:
- During the first 12 months of partial disability the monthly benefit is equal to the loss of income not to exceed the maximum monthly benefit, with a minimum of 50 percent of the monthly benefit for total disability.
- A loss of 75 percent or more of prior income will be considered a loss of 100 percent.
Additional policy benefits
Automatic Benefit Enhancement. This rider provides an automatic 4 percent compounded increase in the base monthly benefit. It’s renewable every six years if you are not disabled. Refusal of two consecutive increases forfeits any future increases and the rider terminates.
Benefit Purchase Option. The insured must purchase at least 75 percent of eligible benefits at the time of policy issue for this no-cost rider to be added to the policy. With the rider, you have the option to purchase additional coverage every three years up to age 55 with evidence of financial eligibility.
Catastrophic Disability Rider. This rider provides additional benefits in the event you are unable to perform at least two of the six activities for daily living; or you require “substantial supervision due to severe cognitive impairment.”
Hospice Care Benefit. Waives the elimination period if you are under a physician-ordered plan of care for hospice services.
Serious Illness Supplemental Benefit. If you are totally disabled due to cancer, stroke or heart attack an additional benefit, equal to 50 percent of the monthly benefit, will be payable for a maximum of 12 months during the life of the policy.
Student Loan Protection. The student loan rider Provides a reimbursement of student loan payments while the insured is totally disabled. Coverage is available for a period of 10 or 15 years from the policy date. When a qualifying total disability occurs, benefits are only payable for the remaining portion of the 10 or 15-year term that has not elapsed.
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