Does anyone know how OMA disability insurance works?

[brady23]

For example, if you are a family doctor making $125,000 yearly with the regular occupation clause, and you become disabled: how much % will it pay you yearly?

And does it pay you for life or for a certain number of years?

 

[rmorelan]

you pay for a set amount of insurance which is limited to an upper amount based on your income and/or job status  (medical students and residents get more insurance than a normal person can get for their current income for instance but as staff it is mostly based on your staff position). As a fellow I can pay for up to 9K a month in disability insurance as an example - staff is higher.  I haven't done this year but I hear the upper limit for staff based on job position is 25K a month.

It pays until you turn 65 normally and is indexed for inflation so you don't slowly make less each year. 

[brady23]

10 minutes ago, rmorelan said:

you pay for a set amount of insurance which is limited to an upper amount based on your income and/or job status  (medical students and residents get more insurance than a normal person can get for their current income for instance but as staff it is mostly based on your staff position). As a fellow I can pay for up to 9K a month in disability insurance as an example - staff is higher.  I haven't done this year but I hear the upper limit for staff based on job position is 25K a month.

It pays until you turn 65 normally and is indexed for inflation so you don't slowly make less each year. 

Thank you! So in the event you became disabled, OMA would pay you 9k a month until you are 65? How much is your monthly cost?

Do you know if you have the "own occupation" clause or the "regular occupation" clause?

 

[rmorelan]

Just now, brady23 said:

Thank you! So in the event you became disabled, OMA would pay you 9k a month until you are 65? How much is your monthly cost?

Do you know if you have the "own occupation" clause or the "regular occupation" clause?

 

if you pay the premium to get to that level then yes you get 9K. How much you pay depends on your age when you start - usually quite low relatively speaking. 

I have own occupation (so if I retain or work in anything else I still get it - even if I make quite a bit in my new job) , guaranteed renewable, with colt of living increase.

Over time my need for disability will drop as my assets take over and I become generally self insured. 

[brady23]

31 minutes ago, rmorelan said:

if you pay the premium to get to that level then yes you get 9K. How much you pay depends on your age when you start - usually quite low relatively speaking. 

I have own occupation (so if I retain or work in anything else I still get it - even if I make quite a bit in my new job) , guaranteed renewable, with colt of living increase.

Over time my need for disability will drop as my assets take over and I become generally self insured. 

Thank you so much! Do you know what the premium is? 

I know it goes way up after med school where we only pay like 50 bucks a year 

[rmorelan]

Just now, brady23 said:

Thank you so much! Do you know what the premium is? 

I know it goes way up after med school where we only pay like 50 bucks a year 

well it goes up because you aren't getting ha the introductory offer as it were, plus you are also probably wanting more than a med student can get. Trouble it depends on age etc so it is hard to get a direct number - I am a non trad so a bit older - probably higher than most other would get. I would just as to get the current pricing

[NLengr]

12 hours ago, rmorelan said:

you pay for a set amount of insurance which is limited to an upper amount based on your income and/or job status  (medical students and residents get more insurance than a normal person can get for their current income for instance but as staff it is mostly based on your staff position). As a fellow I can pay for up to 9K a month in disability insurance as an example - staff is higher.  I haven't done this year but I hear the upper limit for staff based on job position is 25K a month.

It pays until you turn 65 normally and is indexed for inflation so you don't slowly make less each year. 

I think 25k is the limit too.

 

To get more than 10k a month I'm pretty sure you need to show you made 281k or more the year before.

[rmorelan]

1 hour ago, NLengr said:

I think 25k is the limit too.

 

To get more than 10k a month I'm pretty sure you need to show you made 281k or more the year before.

makes sense really ha - 25K tax free a month? That is a lot of money. I wouldn't want to be paying those premiums. 

[brady23]

Wow so OMA really pays you until you're 65 if you become disabled and can't work as a doctor anymore?

I always thought disability insurance only paid out for a few years 

[ploughboy]

On 8/5/2018 at 8:25 AM, rmorelan said:

makes sense really ha - 25K tax free a month? That is a lot of money. I wouldn't want to be paying those premiums. 

I'd love to be paying those premiums...

(but I don't have an $890k yearly earned income to protect)

[rmorelan]

11 hours ago, ploughboy said:

I'd love to be paying those premiums...

(but I don't have an $890k yearly earned income to protect)

oh to be clear I mis-phased that. I 100% would pay the disability premiums to obtain 25K a month if injured.  In fact I will be quite shortly (built into my insurance plan). We really under-estimate collectively our disability insurance needs.  

If I was the disability carrier I wouldn't want to pay it out ha. 

[brady23]

9 hours ago, rmorelan said:

oh to be clear I mis-phased that. I 100% would pay the disability premiums to obtain 25K a month if injured.  In fact I will be quite shortly (built into my insurance plan). We really under-estimate collectively our disability insurance needs.  

If I was the disability carrier I wouldn't want to pay it out ha. 

Wait - so you actually get $25000 per month simply by paying disability premiums (I'd assume the premiums is a couple hundreds per month) until age 65?

[rmorelan]

1 hour ago, brady23 said:

Wait - so you actually get $25000 per month simply by paying disability premiums (I'd assume the premiums is a couple hundreds per month) until age 65?

well if you get disability yes- that is the entire point, you completely replace you income in the event you cannot work. That amount is 300K a year and if you pay it personally (rather than the corp) it is tax free which is the same as a salary almost double. 

The premiums will increase as you age - as the risk of you becoming disabled does. However the amount of coverage you need may also be less as you develop your own net worth (becoming effectively self insured). But in the beginning yeah it is quite reasonable. 

 

[brady23]

27 minutes ago, rmorelan said:

well if you get disability yes- that is the entire point, you completely replace you income in the event you cannot work. That amount is 300K a year and if you pay it personally (rather than the corp) it is tax free which is the same as a salary almost double. 

The premiums will increase as you age - as the risk of you becoming disabled does. However the amount of coverage you need may also be less as you develop your own net worth (becoming effectively self insured). But in the beginning yeah it is quite reasonable. 

  

Interesting, as I thought most disability policies only replace a certain portion of your income and for a certain # of years.

Do you know how much the monthly premium would be, say if you're in the early stages of your career?

[ploughboy]

12 hours ago, rmorelan said:

oh to be clear I mis-phased that. I 100% would pay the disability premiums to obtain 25K a month if injured.  In fact I will be quite shortly (built into my insurance plan). We really under-estimate collectively our disability insurance needs.  

If I was the disability carrier I wouldn't want to pay it out ha. 

Ya, I was just making a joking point that having to pay for a great big disability policy is one of those 'good problems' to have...

[ploughboy]

3 hours ago, brady23 said:

Wait - so you actually get $25000 per month simply by paying disability premiums (I'd assume the premiums is a couple hundreds per month) until age 65?

You also have to have the income to justify it.  No insurer is going to sell you a $25k/month policy if you only make $15k per month.

[Med0123]

11 hours ago, brady23 said:

Interesting, as I thought most disability policies only replace a certain portion of your income and for a certain # of years.

Do you know how much the monthly premium would be, say if you're in the early stages of your career?

As rmorelan mentioned, the premium is dependent on tons of factors. He does not want to disclose how much he pays and that is fine.

For 8.5k a month, I pay roughly $150/mo. I will increase it shortly.

Hope this helps.

[brady23]

9 hours ago, Med0123 said:

As rmorelan mentioned, the premium is dependent on tons of factors. He does not want to disclose how much he pays and that is fine.

For 8.5k a month, I pay roughly $150/mo. I will increase it shortly.

Hope this helps.

Thank you this is very helpful.

Definitely something I want to consider in the future ($150/month is definitely worth it in my opinion). 

[rmorelan]

2 hours ago, brady23 said:

Thank you this is very helpful.

Definitely something I want to consider in the future ($150/month is definitely worth it in my opinion). 

just make sure whatever you get is compatible with whatever the residency union uses - they often have disability insurance too. If you get the ability to increase it guaranteed into the policy then you can bump your core insurance whenever you want - no good not having an insurance policy that expires (like most residency union ones) but no point having one either that would be denied payout if you have further insurance (for obviously reasons insurance companies don't want you to have too much insurance - some people might have an "accident" to then get it)