July 1995 Bulletin

Know full definition of disability

By Joel M. Blau

Joel M. Blau is vice president and senior financial counselor, AMA Investment Advisers, an affiliate of the American Medical Association

Many physicians, concerned that they may become disabled and unable to work, implement a salary continuation plan in their practice. "Disability" is usually defined as "the inability to perform the important duties of his or her profession." This definition, though, must be coordinated with the disability insurance company that is funding the plan. The same holds true if you are employed by a hospital and are covered under a group long-term disability plan.

The insurance carriers may have two definitions of disability. The first provides benefits if the physician is "unable to perform the important duties of their profession and specialty." This is known as an "own occupation" definition. This implies that if your occupation is limited to a recognized specialty, you will receive disability benefits, even if you can continue working in another aspect of the medical profession.

But you must read the sentence that follows the first definition. It states: "After two years (or five years in some policies) you must not be able to perform the duties of any occupation." So, if you can work in any job at all, medically-based or not, you will not be considered "disabled," and your benefit payments will be discontinued.

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