Is the AMA Disability Insurance Plan “True” Own Specialty Disability Insurance?
We have worked with thousands of physicians over the last a decade, and during this time we have researched, studied and evaluated nearly every conceivable type of disability insurance policy available to physicians.
What we’ve learned is that there is something about doctors’ interpretation of disability insurance that is getting them in trouble with some of the policies they end up purchasing. We wanted to take a few moments to write about it in an effort to help get the word out so that we can limit the number of physicians who end up relying on their disability policies, only to learn that it doesn’t protect them the way they thought it would.
Every physician is aware that they should purchase “Own Occupation”, also known as “Own Specialty”, disability insurance. The understanding is that if you purchase a policy that an insurance provider is calling “own occupation” or “own specialty”, you are getting a plan that will pay you if you suffer a disability that limits your ability to work in your specialty, and will continue to pay you your FULL benefit amount should you do something else.
While it is true that these policies exist, what many don’t know is that in the insurance industry “own occupation” or “own specialty” can mean up to three different things, and the AMA, ACOG, ACP, ACS, AAP, etc. all know that you don’t know this.
Here’s why they get away with it. Technically speaking, Own Occupation coverage means that so long as the insurance carrier recognizes your specialty as your occupation, and they do not force you to go an work in another occupation, then it’s OK if they advertise their product as being Occupation or specialty specific.
What most do not realize is this does NOT mean you can go to work in another occupation and still be entitled to your full benefit, or any benefit at all. It simply means they won’t force you to go to work in another occupation but they will not pay you your full benefit amount if you are earning more than 15% of your prior earned income in another occupation.
Let’s take a look at an advertisement visible directly on the AMA’s website, pertaining to the definition of “Own Occupation” disability:
Unlike some other disability plans, this plan contains a preferred definition of disability. If you are unable to perform the duties of “your own medical specialty,” benefits CAN be payable for up to the age of 65.
Frankly reading, it is no wonder why so many physicians end up with the AMA plan… But here’s what your policy will say if you buy it through them:
Totally Disabled or Total Disability means: – Your COMPLETE inability to perform the substantial and material duties of your Current Occupation, and YOU ARE NOT ENGAGED IN ANY OTHER OCCUPATION.
That definitely doesn’t sound like the “Own Occupation / Own Specialty” coverage you’ve heard about, and it definitely doesn’t match-up with what the AMA advertises to you on their website.
Don’t end up making the same mistakes that thousands of other physicians make simply because they are misinformed. As of today True “own occupation / Own specialty” disability insurance can only be purchased individually, and it can only be purchased through the following insurance carriers: Guardian, Ameritas, Principal, The Standard, Ohio National, and Mass Mutual.
Just for comparison purposes, here is the same definition of total disability from the Guardian carrier to compare to the definition from the AMA:
Total Disability or Totally Disabled: means that, solely due to injury or sickness, you are not able to perform the material and substantial duties of Your Occupation. You will be Totally Disabled even if you are Gainfully Employed in another occupation.
This is a big difference and we want to see doctors stop getting the wrong plan simply because of how cheap and easy it is to obtain coverage through the AMA.
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