Graduating in 1 month... buy disability insurance now?

[Miss Bonnie MD]

Wash wrote:

I’m a fellow and on the verge of graduation. The real world is fast approaching which was a big motivation for me to finally start educating myself about personal finance which I had been putting off for a long time. This site and the book have been super helpful!

A recurring suggestion I’ve seen is to buy disability insurance early in residency, since that is when it’s the cheapest plus the most useful. I unfortunately did not know about this and still don’t have disability insurance other than what is provided by the training program. But since I’ll be graduating in just a few weeks, does it make a big difference whether I buy it now versus when I start my attending job?

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What state are you in now and where will you be practicing?

[Scott at MD Financial Services]

Dang Auto correct....Joanna, thanks for the heads up!

[jfoxcpacfp]

Scott @ MD Financial Services wrote:

An example would be a Radiologist vs. an International Radiologist, some carriers charge a premium for the IR docs, others don’t

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Interventional?

[Scott at MD Financial Services]

Once you know what carrier is going to be including the best prices for your specialty, gender, benefit design, state of residency (now or future), then it does kind of come down to price since the carrier can't then change the pricing structure, fixed, step rated (1 time increase in year 5) or Graded (they should just call this annually increasing).  Keep in mind that every carrier has different pricing based on specialty and some carriers even split those prices with some better, some worse within a specialty.  An example would be a Radiologist vs. an Interventional Radiologist, some carriers charge a premium for the IR docs, others don't.  Just be sure to work with an agent that really understands the market as that can make a 15-20% price difference in some situations.

If we can be of further help please let us know.

[Wash]

All things being equal (noncancelable, guaranteed renewable, 3% COL, own specialty, residual disability, future purchase), should I just pick the cheapest plan I get out of the big 5/6 companies?

Also: my job has an included group LTD policy that I can't opt out of and covers 60% of salary. Let's say I change jobs in a few years and need to use the future purchase option. Is my new premium based on the rates established at the time I purchase the plan (i.e. now) or are they re-calculated based on the rates at that time?

[Wash]

Thanks for the advice. I have requested some quotes and will see what I get!

[RosieQ]

I'm graduating soon as well. By my calculations buying early costs about the same as buying later if you plan to hold the policy to age 60 or so. Essentially you pay more every month but for a shorter period of time. Of course, the tradeoff that you get is paying the policy when you are younger and cashflows are tight. But if you forgo that, you have the risk of either becoming disabled or developing a pre-existing condition. I personally think that getting disabled is a rather low chance for a young and healthy person but the pre-existing condition clause is so broad it's scary and makes you never want to go to the doctor for anything. Neck pain or back pain? Better get your policy first or you are in for a world of trouble if that shows up on your chart. Syncope even from dehydration/fatigue and pulling a 30 hour shift without a break? Likely exclusions... I signed my policy as a resident and then had to come in to the hospital as a patient 2 weeks later. So glad I had everything in place. All better, back to baseline and no issues- but that chart will always be there and would make a new policy VERY difficult.

[jfoxcpacfp]

Of course, you can always consider the fact that you haven't paid premiums for a few years to be an offset to higher rates now - and be thankful that you're still healthy and insurable.

I concur with fasteddie911. The best place to start is the vetted insurance pro's who advertise on this site.

[fasteddie911]

I would hookup with an agent and talk it over with them, get some quotes, etc.  I got my DI during training and was given certain discounts, not sure if it was because of my affiliation to my training program, hospital or what, or if the discount would have applied as an attending.  Nevertheless, it wouldn't hurt to talk with a good agent as soon as you can as they can give you insight specific to your specialty, hospital or State.  Moreover, I think it's a good idea to get DI as soon as you can as you never know what can happen that can affect your ability to do your job or your future insurability.

[Wash]

I'm a fellow and on the verge of graduation. The real world is fast approaching which was a big motivation for me to finally start educating myself about personal finance which I had been putting off for a long time. This site and the book have been super helpful!

A recurring suggestion I've seen is to buy disability insurance early in residency, since that is when it's the cheapest plus the most useful. I unfortunately did not know about this and still don't have disability insurance other than what is provided by the training program. But since I'll be graduating in just a few weeks, does it make a big difference whether I buy it now versus when I start my attending job?