Cropped tie

Thomas J. Segedin CFP®

[Editor’s Note: This is a guest post by Thomas J. Segedin CFP®, a physician-focused financial advisor in New York City.  We have no financial relationship, but obviously part of his income comes from selling disability insurance.  He is an independent agent and can sell from any insurance carrier.  He wanted me to point out that the quotes and facts in this article are current as of the publication date, but are likely to change in the future as the disability insurance marketplace evolves.]

Sometimes disability insurance can offer a free lunch.  A good example of this is when one disability insurance carrier considers your occupation to be in a less-risky occupational class than another carrier.  When looking into disability insurance, it’s worthwhile seeing if there are any companies that do this for your particular occupation.  Physical therapy is one occupation where there is a distinct difference.  [Editor’s note:  This article discusses disability insurance for MPTs and DPTs.  Physical therapists without one of those degrees are actually treated differently.]

Occupation Classes

Every individual disability insurance (IDI) carrier separates occupations into different occupation classes.  The occupations which the insurance carrier perceives as the best risks to insure, receive the highest occupation class.  The occupations viewed as the most risky receive the lowest occupation class.

The highest occupation class receives the carrier’s:

    • Highest Monthly Issue Limits
  • Strongest Definition of Total Disability the Insurance Carrier Offers
  • Lowest Rates for Coverage

Conversely, the lowest occupation class receives the carrier’s:

  • Lowest Monthly Issue Limits
  • Weakest or Modified Definition of Total Disability
  • Highest Rates for Coverage

Determining Your Class Some occupations, such as attorneys and accountants, receive the insurance carriers’ highest occupation class across the board. Physicians are placed into various occupational classes with the procedurally-oriented specialties generally being in a lower occupation class, but for most specialties there is little variation between the six main IDI carriers- Ameritas Life Insurance, Berkshire/Guardian, Mass Mutual, Met Life, Principal, and The Standard.  Physical therapy (both MPT and DPT), however, is viewed very differently amongst the six carriers. Let’s look at an example.  Consider a 32 year old male DPT/MPT in New Jersey.  He wants an IDI policy with the following characteristics:

  • Noncancelable and Guaranteed RenewableMonthly Benefit: $5,800
  • Catastrophic Benefit: $4,625
  • Residual: Yes
  • Cost of Living Adjustment: 3%
  • Elimination Period: 90 Days
  • Benefit Period: to age 67

We’ll ignore future increase options for the moment as there substantially different maximum issue limits amongst the carriers, making direct comparisons difficult. Let’s compare the policies these six carriers offer to physical therapists.  As we do this, remember the various definitions of total disability, which I list here from weakest to strongest:


Any Occupation: Due to injury or illness, you are unable to work in any occupation you are reasonably suited to by your education, training, or experience

Modified Occupation:Due to injury or illness, you are unable to perform the substantial and materials duties of your occupation AND you are not working in any occupation for wage or profit

True-Own Occupation: Due to injury or illness, you are unable to perform the substantial and material duties of your own occupation. This definition allows for full benefits if you are disabled in your own occupation even while earning income from another occupation.

The Comparison

I’ll list the various carriers and their policies for physical therapists from weakest to strongest.

Principal: Worst Definition of Total Disability

  • Maximum Monthly Issue Limit: $6,600
  • Definition of Total Disability: Modified Own Occupation for 5 Years, then Any Occupation
  • Annual Premium: $5,577.95

MetLife: Lowest Monthly Issue Limits

  • Maximum Monthly Issue Limit: $5,800
  • Definition of Disability: Modified Own Occupation for Entire Benefit Period
  • Annual Premium: $4,488.22

Ameritas Life:  Higher maximum issue limit and improved definition of disability

  • Maximum Monthly Issue Limit: $10,000
  • Definition of Disability: True Own Occupation for 5 Years then Modified Own Occupation
  • Annual Premium: $2,857.56

Mass Mutual:  Higher maximum issue limit and an even better definition of disability

  • Maximum Monthly Issue Limit: $10,000
  • Definition of Disability: True Own Occupation for Entire Benefit Period- 24 Month Benefit Period for Mental Disorder/Substance Abuse Limitation
  • Annual Premium:$3,286.28

Berkshire Guardian: Even higher maximum issue limit and top definition of disability

  • Maximum Monthly Issue Limit: $16,000
  • Definition of Disability: True Own Occupation for Entire Benefit Period
  • Annual Premium: $3,137.84

The Standard: Strongest definition of total disability, highest monthly issue limits, AND lowest cost

  • Maximum Monthly Issue Limit: $20,000
  • Definition of Disability: True Own Occupation for Entire Benefit Period
  • 15% Discount for Business Owner
  • Annual Premium: $2,353.36
  • Annual Premium With Business Owner Discount:$2,000.36

For a 32 year old, Male, Doctor of Physical Therapy (also true for Female DPT/MPTs) it is clear that they should look to protect their income from the risk of a long term disability with The Standard.  It really comes down to occupation class.  Standard puts DPTs into their 4a class (second highest)  whereas the other carriers place them into lower classes, sometimes much lower.


Occupational Class of Physical Therapists with Various Carriers

The various carriers use slightly different classes, but they’re pretty comparable. Some use the “M” suffix, which simply refers to medical.

Principal 2A
MetLife 2A
Ameritas 3M
Mass Mutual 3A
Guardian 3M
Standard 4A

As you can see, there’s a direct correlation between occupational class assigned and the strength and cost of the policy offered.  Under current market conditions, there is little reason for a physical therapist to buy a policy from any carrier besides The Standard.