Do you have the right long-term disability insurance policy in place?

sign that says RISK

As part of our Intentional Wealth financial planning process, Wealth Dimensions conducts an in-depth review of each client’s insurance needs as well as the adequacy and costs of existing policies in place.

Sometimes these assessments identify ways for clients to save money on existing polices, whether it’s a homeowners, life, disability, or an auto policy.

However, more often than not, our reviews uncover meaningful gaps in existing coverage. Specifically, the insurance gaps we uncover most during our Intentional Wealth financial planning process pertain to doctors and dentists who either have

  • The wrong type of long-term disability insurance in place, or
  • A policy that provides inadequate coverage

As a result, many professionals are exposing themselves to a high degree of risk if they are unable to treat patients.

Doctors and dentists need “own occupation” long-term disability insurance with the right type of coverage

Two big mistakes we see doctors and dentists making, that you need to avoid, are

  • Not purchasing insurance that’s specific to their profession. It’s important for medical and dental professionals to ensure the long-term disability policy they purchase is an “own occupation” policy versus an “any occupation” policy. This means the policy must contain specific language that covers their occupation. “Any occupation” policies will not provide replacement income if you are able to work in a profession that’s unrelated to medicine or dentistry.
  • Purchasing a policy that covers their profession but limits the benefits. “Own occupation” policies come in many flavors. Essentially, the definition of “own occupation” can vary. Some policies provide total disability coverage if you are unable to perform the substantial duties of your regular medical or dental specialty or sub-specialty. Other types of policies limit the benefits a doctor or dentist can receive if they are unable to work in their specific job, but can perform other duties related to their profession.

Consider this example: A dentist had surgery on her hand and is unable to treat patients for the next 12+ months. Yet, she is able to teach graduate level courses at a nearby dental school, or focus on the administrative aspects of the practice, while other associates treat patients. In either situation, some own occupation polices will view the teaching assignment or administrative duties as “own occupation work” and limit the replacement income the dentist had expected from the policy.

Steps doctors and dentists can take to protect themselves

  • Carefully review your long-term disability policy to ensure it is an “own occupation” policy and specifically covers your profession. If you do not have such a policy, it’s important to consider switching to one that does.
  • If you have an “own occupation” policy, review the total disability language to ensure you understand in what situations you are covered and how much coverage is provided. If the language does not provide you with the level of protection you desire, then consider changing policies.

Language in insurance policies can be complex and difficult to understand; so don’t try to figure this one out alone. Reach out to your financial advisor or insurance agent to help you better understand: 1) how you are truly covered and 2) your exposure in any situations if you are unable to work.

Your goal for this type of insurance review is to ensure you minimize any risks of being penalized for receiving benefits you expect if you are sick or injured and unable to treat patients for an extended period of time.

For informational purposes only. Not intended as legal or investment advice or a recommendation of any particular security or strategy. Information prepared from third-party sources is believed to be reliable though its accuracy is not guaranteed. Opinions expressed in this commentary reflect subjective judgments of the author based on conditions at the time of writing and are subject to change without notice. For more information about Wealth Dimensions, including our Form ADV Part 2A Brochure, please visit or contact us at 513-554-6000.

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