By Dan Miller, WCI Contributor

There are many different kinds of insurance available, and most types of insurance can make sense for the right group of people in the right situations. While you may be more familiar with the benefits of life insurance, disability insurance is also quite important for physicians. After all, one of the biggest risks that physicians face is not being able to get paid for the knowledge and skills that took decades to learn. There are several different types of disability insurance, and each can make sense in the right situations. While individual and group disability insurance are probably the two most popular, knowing what Guaranteed Standard Issue (GSI) disability insurance is and how much it costs is important.


What Is Disability Insurance?

Disability insurance is a form of insurance that will pay you if you suffer a disability that prevents you from working. The cost of GSI disability insurance—or any other form of disability insurance—is going to vary based on factors like your age, the term of the policy, and your total income. It's important to understand that there is a limit to how much disability insurance you can buy—in most cases, the policy you purchase will pay out a percentage (around 60%-70%) of your pre-disability income. So, you'll want to make sure to either plan to live on less in that case or to have an alternative savings plan.


Why Should Physicians Get Disability Insurance?

High-income earners like physicians are one group of people for whom disability insurance makes the most sense. Physicians spend years (if not decades) learning their craft for very little (or no) income. As long as you can then make a very high income practicing your craft for decades, the low-income years of medical school and residency will have been worth it. But if you suffer a partial or total disability early on in your career, you may be stuck in a situation where you have crushing medical school debt without the high income to pay it off.

gsi disability insurance cost

Disability insurance is one way that you can mitigate this risk. With a disability insurance policy, you pay your premium either monthly or annually. If you later become partially or totally disabled, you file a claim, and if the insurance company is satisfied that you meet the disability criteria of the policy, they will pay out the monthly benefit amount according to your policy. These payments continue as long as you are disabled or until you reach a certain age defined by the policy (often 65-70 years old).

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What Are the Different Types of Disability Insurance?


The Difference Between Guaranteed Standard Issue Disability Insurance and Other Types of Disability Insurance

Here's a look at how Guaranteed Standard Issue disability insurance policies compare to individual and group disability policies, two of the other common forms of disability insurance:

  • Individual Disability Insurance — An individual disability insurance policy is highly customizable, allowing you to choose the right policy and premium for your individual situation. Most individual disability insurance policies require a medical exam, meaning you may not qualify if you have past medical issues or a preexisting condition.
  • Group Disability Insurance — A group disability insurance policy is often provided by your employer. While the premiums are generally lower than individual disability insurance (and may be paid by your employer), you have less control over the payout or the terms of the policy.
  • Guaranteed Standard Issue Disability Insurance — As the name suggests, GSI disability insurance is a type of disability insurance that guarantees coverage to eligible individuals without the need for a medical exam. This means that people with preexisting conditions or past medical history can still get disability insurance. GSI insurance is typically offered as a group policy in conjunction with an employer, like a hospital or medical school. 


How Much Does Guaranteed Standard Issue Disability Insurance Cost?

If you are wondering how much GSI disability insurance costs, the answer is that it will depend on a number of different factors. The cost of GSI insurance will depend on the policy, the provider, and the overall health profile of your group. GSI plans can vary and sometimes are less expensive than fully underwritten plans, however, that's not always the case.  It's best to work with a trusted insurance agent to find the policies that are best for your specific situation.

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The Bottom Line

Determining the cost of a Guaranteed Standard Issue disability insurance policy will vary based on a few factors, including the overall health of your group, your policy specifics, and the provider. But it's nice to have the option to get a policy that doesn't require a medical exam, especially if you have a past medical history and/or a preexisting medical condition. Work with your insurance agent or trusted financial advisor to determine the best policy for your specific situation.

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