How a disability is categorized can make a difference on how a claim is handled. In some plans a Mental Nervous and Stress related claim is limited to a 24 month maximum payout, where other policies may pay the claim without limitation to your age of 65. You don’t want to learn about this critical difference in definitions when you’re dependent on a monthly disability check.
The Mental Nervous and Stress/Nervous limitation is most commonly found in group/association policies but has now been showing up in some non-cancellable guaranteed renewable plans. Be aware that this category of claim is not limited to the major diagnosis’s such as schizophrenia or bipolar disorders. It can include the following types of claims as well: soft tissue issues, fatigue syndrome, anxiety, emotional problems, Epstein-Bar, Attention Deficit Disorder, Fibromyalgia and of course alcohol and drug related issues just to name a few. Having such a restriction within your policy exposes you to limitations that may not be necessary, while costing more or the same as coverage that provides full protection.
What Physicians who are moving to, moving from or living in California need to know:
A lesser known fact is that 99% of all individual policies sold to physicians in California include this limitation. Therefore, if you plan on moving to California after your residency you need to secure a policy before you relocate. Additionally, if you are completing your residency in California but plan on relocating to another state you should shop just prior to the end of your residency. Some companies will allow you to use your new established address in another state to apply for your protection, thus forgoing the limitation.
In conclusion when considering a policy you must be aware of the language and do your homework. Limitations such as this work in the favor of the insurance companies and should be avoided at all cost if possible.
