Many residents and fellow physicians elect to wait until their last year of residency or fellowship before securing disability insurance. If you’ve been in our communities, you know that we don’t recommend this, as we think it’s important to get disability insurance ASAP after graduating medical school, as you’re most likely to qualify without exclusions then as well as secure the lowest rates. This is particularly important for women who may be considering getting pregnant, as purchasing disability insurance before pregnancy is highly recommended. Unfortunately, we often see female physicians encountering difficulty securing reasonably priced disability policies without exclusions if they’ve had infertility workups, pregnancy complications, or other medical issues come up or investigated in routine lab work or exams prior to or during pregnancy. Below, we’ll cover FAQs about when to buy disability insurance and why, short term disability insurance, and what to do if you have an exclusion placed on your policy.
Note: This article is part of our resources for graduating residents and fellows and transition to practice series. We’ve compiled a list of other relevant resources below. If you are not a part of our transition to practice series and would like to sign up, you can find the sign-up link at the top of our transition to practice guide.
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Why is disability insurance important for physicians, and do I need it?
Disability insurance is a cornerstone of physician personal finance. Unless you are financially independent and the extra thousands of dollars a month wouldn’t change your ability to live the life you want if you could no longer earn money as a physician, the answer is likely yes. Most physicians carry disability insurance for at least the first decade or two of their practicing years, if not longer.
If you are unsure of whether you need disability insurance, please review our primer on disability insurance for physicians as well as this article on some reasons why physicians mistakenly think they don’t need disability insurance.
When should women physicians buy disability insurance?
The answer here is ASAP, as it is for all physicians. You don’t want to risk not being able to qualify for disability insurance later, trauma or health events resulting in exclusions being placed on your policy that prevent you from claiming disability related to some causes of disability, or premiums going up because of increasing age. Lock in on your health now by contacting a disability insurance agent that specializes in physicians, and then you can always increase your benefits later at better rates using a future benefit increase rider as your salary increases, without having to take another medical exam.
Why is it particularly important that women physicians get disability insurance prior to pregnancy?
First of all, if you apply for disability insurance while pregnant, your disability insurance policy will likely exclude complications related to pregnancy.
However, more importantly, as we know as physicians, unexpected things happen during pregnancy and lots of tests are run during pregnancy. These can only hurt you in the underwriting process for disability insurance. If you have abnormal bloodwork, you fail a glucose test, or you develop preeclampsia, this may dramatically increase your rates for disability insurance in the future or even exclude you. Your doctor’s note that says you complained of some back pain may count against you. It’s really hard to say what an insurance underwriter will decide to pick out as problematic, but the less things you have on your record when applying for disability insurance, the better for your covered benefits and your wallet.
If you’re not convinced about this, do a quick search on our physician communities for disability insurance and women having exclusions placed on their policies, getting higher rates, or getting denied for disability insurance altogether.
Do disability insurance policies cover unpaid maternity leave or time off (i.e. short term disability)?
While FMLA is in place to protect you from losing your job while you’re on maternity leave, it does not protect your income. Therefore, we get many questions about using disability insurance policies for unpaid maternity leave.
There are short term disability insurance policies and long term disability insurance policies.
If you are fortunate enough to have a short term disability insurance policy through work or have independently purchased a short term disability policy prior to your pregnancy, you may be able to use this for unpaid maternity leave (check your policy’s terms and conditions). There are some things that are important to know. The day that you deliver starts the clock on the waiting period (elimination period) before your benefits kick in, which is typically 7-14 days for short term disability policies. After that period ends, you are now eligible for benefits (benefit period). Most short term disability insurance policies have a certain time frame that you can get benefits for based on what the disability is - for example, they may pay out differently for an uncomplicated vaginal delivery versus a caesarian section. For pregnancy, it’s typically 6-8 weeks. Complications before or after your delivery (such as bedrest before, or a childbirth related injury) can modify these standard benefit periods. While you can get your paperwork prepared prior to the delivery, you cannot actually file your claim until after you have delivered. Since policies differ, make sure that you confirm with your policy or human resources department what’s covered prior to going out on maternity leave, as you don’t want to plan on having this money and then find out you aren’t covered.
However, what we are usually referring to when we’re talking about disability insurance on the groups is long term own occupation disability insurance policies. If this is the type of disability insurance policy you have, know that routine post pregnancy time off will not usually be covered by long term disability insurance policies. These long term policies typically have a long elimination period before benefits kick in, which for some physicians can be as much as 12 months. Most physicians tend to have policies where the elimination period is 60-90 days, which is still longer than the time needed to recover from most uncomplicated deliveries. While there are long term disability insurance policies with elimination periods as little as 30 days, they are much more expensive and thus typically not recommended for your long term disability insurance policies, which are meant to cover catastrophic lifelong disabilities rather than short periods of time. Additionally, you’d have to meet criteria for disability past those 30 days to qualify.
That said, if you do unfortunately have a complication that prevents you from going to work past when your elimination period of waiting for benefits is over, your long term disability insurance will kick in. This could be related to your pregnancy or delivery, or an issue such as post partum depression, but also related to long standing medical conditions that were exacerbated during your pregnancy or delivery, such as multiple sclerosis or an autoimmune issue. Therefore, having long term disability insurance in place prior to pregnancy is also a good idea regardless.
Therefore, it is recommended that most women physicians without dedicated short term disability insurance policies and unpaid maternity leave build up their emergency fund during pregnancy, and rely on that. Other options include saving PTO days such as vacation and sick days.
Can I purchase disability insurance while I’m pregnant?
You are unlikely to be able to purchase a short term disability policy that covers pregnancy once you are already pregnant, as it will be considered a pre-existing condition that’s not covered. Insurance companies, of course, are in the business of making money, so they’re unlikely to sell a policy where there is an (almost) guaranteed payout.
You can also purchase a long term disability insurance policy during pregnancy. However, again, based on the experience of physicians in our community, there will almost definitely be an exclusion placed on your policy related to pregnancy related complications as it is again a pre-existing condition. That said, we still recommend that you purchase the disability insurance policy during your pregnancy rather than waiting for after you are pregnant given the potential for interim complications discussed above that could preclude you from qualifying for disability insurance or make it prohibitively expensive.
Note that insurance companies may exclude pregnancy from being covered even if you aren’t pregnant yet but disclose that you are trying to become pregnant or if your medical records have documentation that you’re trying.
What happens if they put a pregnancy exclusion on my disability insurance policy?
Talk to your disability insurance agent about what your options are. In many cases, these exclusions can be removed after the pregnancy is over.
What about infertility workups or treatments or freezing my eggs?
As above, some insurance companies unfortunately may exclude pregnancy if you have shown that you’re trying to get pregnant. We’ve been surprised to see several female physicians in our communities report that they’ve had exclusions placed on their policy for pregnancy related complications even for doing things like freezing their eggs or initiating an infertility workup.
Additionally, lots of lab work and procedures are done during infertility workups which can reveal abnormal results that can then be used against them in underwriting for disability insurance.
Bottom line - if at all possible, get your disability insurance policy prior to any workups or before indicating that you’ll be pursuing a pregnancy.
Conclusion
Women physicians should secure their disability insurance plans as soon as possible after graduating medical school, but particularly before pregnancy. Getting a disability insurance plan while pregnant will likely lead to an exclusion of coverage for disability that is related to the pregnancy. Additionally, complications or diagnoses uncovered during pregnancy, even if transient like gestational diabetes or preeclampsia, could result in permanent exclusions on your disability insurance policy, increases in pricing of your disability insurance policy, or even denials for disability insurance coverage. Given how important disability insurance is for physician financial security, you don’t want to roll the dice on having a totally healthy pregnancy, as we as physicians know that complications happen, and you’ve worked too hard to get to where you are to not be financially secure.
If you have more questions about this topic, contact a recommended disability insurance agent that specializes in physicians.
Additional disability insurance resources for physicians
Learn more about disability insurance with:
Graduating residents and fellows, check out more content from our Transition to Practice series: