Graduating medical students are often advised to purchase an individual disability insurance policy to supplement the coverage provided by their employer during training and in the practice years that follow. 

While purchasing additional coverage to make sure you have enough income to meet your bills if something happens during training is always a good idea, the lack of discretionary income or the health questions traditionally asked by insurance carriers can present insurmountable obstacles. 

With these concerns in mind, your medical school has secured for its graduates the guaranteed right to secure additional income protection through a policy designed to meet the coverage needs and budgetary constraints of a resident. This contract is not offered to individual consumers on the open market and is only available until 30 days after graduation. Some of the advantages of this coverage include:

You can’t be denied due to a current or pre-existing health condition

Normally, anyone trying to secure an individual disability insurance policy must answer an extensive medical questionnaire and any significant health histories may allow the insurance company to deny the application or add a significant surcharge. Through the offering created by your medical school, you will not be required to answer any questions about your health and the ability to secure coverage is guaranteed. 

All current medical conditions are fully protected

When an insurance company evaluates the medical history of an applicant, there are times when the presence or history of a medical condition will cause the company to exclude any claims associated with that condition, no matter how far in the future the disabling event occurs. Thankfully, the coverage offered to graduates will not have any exclusions for any medical conditions and any future claim due to a pre-existing or current health condition will be covered. 

Pricing during training is substantially lower than pricing for traditional policies 

One of the greatest barriers facing a resident looking for additional protection is the cost of purchasing coverage. The amount of money required to obtain the type of policy offered by insurance companies is likely to be  larger than your take-home pay, after you’ve paid your monthly bills. Thankfully, the cost of the coverage offered by your school has been created to address the financial constraints faced during residency. 

Student loan payments can be reimbursed

One of the biggest financial threats facing a resident who becomes sick or hurt is their ability to meet their ongoing loan obligations. Unfortunately, very few insurance carriers include language in their policies that address this liability.  Thankfully, the coverage offered by your medical school includes provisions that could reimburse you for a substantial portion of any loan payments that are due during a severe disability. 

Guarantees the ability to increase coverage after training

As you approach the end of your residency or any subsequent fellowship you can exchange this coverage for an individual “specialty specific” policy without having to medically qualify. The monthly benefit available upon graduation will typically be twice the benefit amount maintained during training.  You are not required to immediately purchase the entire amount upon graduation and any deferred portion can be accessed at a future policy anniversary date .

Summary

The coverage secured by your medical school presents an important opportunity to protect your financial wellness during and after training. This opportunity is available to graduates until 30 days after graduation.