Reasons Why Physicians Get Declined for a Disability Insurance Policy
- Nisha Mehta, MD
- 6 hours ago
- 12 min read
Disability insurance is a cornerstone of financial planning for doctors, as it prevents them from devastating financial consequences if something happens to their ability to earn money as a physician. As such, it’s important to get disability insurance as early as possible, before reasons for denial come up secondary to unexpected health issues or otherwise. We’ve heard stories from members of our online physician community over the years who have applied for disability insurance for the first time, only to discover that the issuing insurance company denied their policy. This can cause issues for future eligibility, which leaves physicians vulnerable financially and can be very unsettling in the future. Below, we cover common reasons why physicians get declined for disability insurance, the impact of having a denial on your record, steps to take to help prevent a denial, and options if you think you might not qualify for a standard own-occupation disability insurance policy.
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Why do insurance companies decline disability insurance to some physicians?
Typically, an insurance company will decline coverage when their actuarial analysis during underwriting leads them to believe you’re more likely than average to make a claim because of factors such as your health or lifestyle. This can be true for both short-term disability and long-term disability insurance, and can apply for both individual plans you purchase yourself and coverage for a group plan through your employer.
There are several reasons why a physician may be declined for coverage under a disability insurance policy. While the reasons below aren’t all inclusive, they cover many of the common reasons we’ve heard about in our online physician community, as well as from guidance from our physician disability insurance broker partners.
Note that sometimes these reasons won’t lead to an outright denial, but rather an exclusion of coverage under specific circumstances or reduced benefits. This at least allows you to get some coverage, but it is worth shopping around using a broker to see if other companies would not give you the same limitations. For example, if in training, a guaranteed standard issue disability policy may be a better option available to you.
It’s also important to note that insurance companies can care about issues that seem minor or irrelevant to doctors. Underwriters are assessing conditions through a different lens than physicians do. If you fail to disclose something, or if something shows up in your records during the underwriting process, it can be a cause for denial. We cover the implications of having a denial on your record below below.
Common reasons why physicians get declined for a disability insurance policy
Pre-existing conditions and disability insurance denials
A known health condition or diagnosis prior to your application can make it difficult to find disability insurance and may cause a denial if you apply. Some common pre-existing conditions that disability insurance companies may see as a risk if they think it could impact your ability to work include:
Arthritis
Asthma
Carpal tunnel syndrome
Cancer
Chronic pain
Depression
Documented need for surgery (even elective)
Epilepsy
Fatigue
Genetic conditions
Hepatitis
History of broken bones or injury
HIV/AIDs
Kidney diseases
Long COVID-19
Multiple sclerosis
Vertigo
Other pre-existing conditions are less likely to cause denials (but may cause exclusions or max benefit periods) when well managed. These can include:
Back pain
Diabetes
Sleep apnea
Ulcerative colitis
Certain mental health issues
A denial centers around an insurance company’s assessment of risk of how a certain condition may negatively affect your ability to perform your job and thus the likelihood of you filing a claim against your policy. Recent diagnoses can often raise more alarm flags for insurers than longstanding conditions, as there’s more uncertainty over long-term implications.
Given the number of potential causes for denials listed above, it’s important to discuss any and all pre-existing conditions with your insurance broker prior to applying for a policy, regardless of if you think it’s something of concern. The independent insurance agents for physician disability insurance may know which companies tend to be friendlier to which conditions, and which ones will almost surely result in denials versus the ones that may just result in exclusions of coverage for that particular issue. If you’re a resident or fellow with access to a guaranteed standard issue disability insurance plan, they may recommend that you go that route instead to guarantee coverage.
Unknown medical conditions and disability denials
If you have been or are being worked up for a medical condition that has not yet been identified or diagnosed, this can be another cause for getting declined for a disability insurance policy.
Your condition may seem minor to you, but without a definitive idea of what you might be dealing with, insurance companies may not be willing to take the risk that it turns into something more significant.
Oftentimes, insurance companies will require you to get a doctor to sign off on your condition before they are willing to offer you coverage. Not having this done prior to submitting your application can be a cause for a denial. Note that many policies will also have conditions that allow them to deny coverage in the future if it’s clear to them that it was suspected that you were showing signs of a medical condition at the time of the application, even if you hadn’t yet received a formal diagnosis. This is another reason to get your disability insurance policy early on while you’re still young, before something pops up.
Another instance that could occur is that the labs or physical exam for your disability insurance policy reveal a condition you weren’t aware of, such as diabetes or hypertension, which could result in an exclusion (or in the rare case that it reveals something more serious, a denial).
Unresolved treatments or conditions and disability insurance
For similar reasoning, you may be denied a policy if there is an error in your medical records or if you previously had a complaint that resolved on its own, but your doctor hadn’t marked a condition or treatment as “resolved” in your past, even if you’re no longer dealing with it.
Having your doctor make a note in your medical records prior to applying for a policy can help you avoid a denial. Should the insurance company find an issue during the underwriting process, they may deny your policy, or postpone the start of the policy until you’re able to get it resolved.
Upcoming medical procedures and disability eligibility
If you have a recommended medical procedure or an upcoming one that is scheduled, you may not be eligible for coverage until your procedure is completed and deemed successful or a diagnosis is known.
Getting a disability policy when you’ve written a prescription for yourself
If you’ve written a prescription for yourself, the underwriter doesn’t know if it was for a legitimate reason or not. This can be a potential huge red flag and can cause the insurance company to decline your application, even if it was for a minor prescription, so be very careful about self-prescribing.
Disability denials for being underweight or overweight
Insurance companies may have a BMI chart they use when assessing applicants. If your weight is too high or too low compared to their chart, your policy may be declined, or you may be offered a subpar policy that only pays out for a few years or with a lower max coverage amount.
Exclusions and limitations on disability insurance policies versus denials
As noted above, a denial isn’t always the outcome of an issue identified by underwriting. There are also other potential outcomes such as:
Higher rates
Excluding coverage for certain conditions, while still issuing the disability insurance policy
Limiting the amount of time a disability insurance policy pays out (in most cases, payout is until 65 or 67, but they may limit payout to a few years)
Longer waiting period before benefits are paid out for a certain condition
Limiting the term for which your policy is in effect, requiring you to purchase a new policy again in a few years, which will require another medical examination/underwriting
Also note that exclusions or conditions can sometimes be lifted in the future if a condition has resolved. This is often the case for things like pregnancy exclusions or recent injuries.
How to prevent getting denied for disability insurance
While the insurance company provides final judgment on whether to issue a policy, there are steps physicians can take to help significantly reduce the chance of having a policy declined.
As you start shopping for disability policies, be completely honest and open with your insurance agent or broker about your medical history and any possible health concerns. For example, if you’re currently receiving any medical treatments or are planning to do so before you put a policy in place, let them know. If you have an upcoming surgery or procedure recommended or planned, make sure this is clear prior to starting the application process.
Discuss any potential disqualifiers, however seemingly insignificant to you, before submitting an application to an insurance company.
Insurance agents and brokers know how the specific insurance companies they work with operate. They will have first-hand knowledge on what might cause an application to get denied, and will be able to advise you of concerns before you fill out an application for a policy. Not only will this help prevent a denial on your record, but they can also help you assess alternative options you might be able to qualify for, if needed, given your specific situation. We cover one potential option of GSI policies below.
How to find a disability insurance broker to work with
An independent insurance broker can help you shop different policies. They are paid a commission by the insurance company, so it doesn’t cost you anything to use their services, and they often have access to discounts you wouldn’t be able to get on your own. They help you find the best possible policy, as well as guide you through the process and advise you if you might have issues with a potential denial if you apply.
If you need a recommendation for an insurance broker, we have resources to help.
Pattern: This convenient option will allow you to enter your information and immediately begin generating quotes from the major disability companies, as well as schedule a meeting with the Pattern team to discuss the options and figure out which plan is best for you. Many in the group have had a great experience with this process. Contact them here.
Moment Insurance: Complete your quote inquiry information in less than five minutes and easily schedule an appointment to speak with a dedicated, experienced disability insurance expert who will walk you through the process from start to finish and help you compare different options. Many in the group have worked with their experts previously, and had a great experience! Contact them here.
Implications of being denied for a disability insurance policy
Sometimes, a disability insurance denial may come from a temporary health condition, or from an issue in a physicians’ medical records. In these situations, doctors may wish to apply for a disability insurance policy again in the future, once the issue is resolved.
When applying for disability insurance, the application almost always asks if you’ve been declined for an insurance policy in the past. Reporting a past denial can make it much more difficult, if not impossible, to secure a policy. Thus, a denial can prevent you from ever getting disability insurance. This is why we can’t emphasize enough the importance of proper due diligence and disclosure of potential issues, however minor they may seem, when going through the process of obtaining a disability policy, and working with an independent disability insurance broker to help you navigate the process.
Options if you are ineligible for a standard disability insurance policy
Above, we cover common reasons physicians get declined for a policy. We also cover guidance on how to prevent a denial. If any of these situations apply to you, or if an insurance broker has already warned you that you’ll be denied for a own-occupation policy, you have a few options to explore for disability insurance coverage.
Ask your agent to talk to the insurance company if a reason doesn’t make sense
Occasionally, the underwriters get it wrong, or make a bigger deal out of something than it may be in reality. A qualified insurance broker may be able to go to bat for you, or tell you what you need in terms of documentation from your doctor to support your claim that this is unlikely to result in disability.
Apply for a policy later, once your circumstances have changed
If your reason for a potential denial is temporary, you may be able to wait and apply for a policy later, once the issue has resolved. Again, we highly recommend working with an experienced independent insurance broker and being fully transparent with them about your history before you apply to help ensure you’ll meet the policy requirements now.
Look into a guaranteed standard issue (GSI) policy
The GSI plan is available at select training programs and occasionally with certain employers. It provides an option for disability insurance coverage for doctors who otherwise might not qualify for a policy, such as for one of the reasons listed above.
If you are deemed at risk of not qualifying for a standard own-occupation disability insurance policy, a GSI policy may be an alternative available to you to consider. These policies have minimal, if any, underwriting requirements, and can be a great option for those who would otherwise not qualify for a standard own occupation disability insurance policy. Note that there are some disadvantages to these plans as they can be less customizable, have lower payout limits, or have certain exclusions, but they are much better than not having a policy at all.
Learn more about the guaranteed standard issue (GSI) policy for physicians with preexisting conditions.
It is important to note that being denied a standard own occupation disability policy can also make you ineligible even for GSI plans, so if you’re at risk of not qualifying, it’s important to look into this option before applying for a standard policy you aren’t eligible for. An insurance broker can help you assess options, but they may not always have the most up to date information in their system of available GSI policy programs if your employer or program recently changed options. Check directly with your program as well before exhausting all options.
Self insure against needing a policy
Self-insuring to the point where you don’t need a disability policy typically isn’t possible until later in a doctor’s career, and we hope you have a policy in place before then. This is one of the reasons we recommend getting a policy in place early in your career, as future medical conditions and health concerns can make you ineligible later in life. Plus, you can often qualify for trainee discounts to reduce the cost of premiums.
If you can’t qualify for a policy, you may need to put financial guardrails in place for worst case scenarios when putting together your financial planning. In this situation, you may want to have a larger emergency fund or be intentional about keeping your monthly bills and expenses lower so you can survive a financial speed bump in the event of a disability.
A financial advisor can help you put together a full financial plan in this situation.
What happens once I’m declined for disability insurance?
Unfortunately, as mentioned above, once you’re declined, it can be very difficult to secure coverage in the future.
If you are declined a policy, potential options that might exist, depending on your situation, include:
Coverage through a group policy offered by your employer
Coverage though a group policy offered by a professional association
An individual policy through a different insurance company, often with other limitations such as a lower max payout or a reduced number of years of benefit coverage
Group policies have several limitations when compared to having your own disability insurance plan, but having some coverage in place is better than none. Once you have a denial on your records, obtaining a policy will likely include an exclusion or limitations on your policy, but again, having coverage for certain circumstances is better than no coverage at all.
If your denial or medical history disqualifies you from any coverage, then we recommend doing your best to self-insure as mentioned above to help mitigate the financial burden in the event of a disability in the future.
Conclusion
Doctors can be declined for disability insurance for various reasons, including pre-existing conditions, upcoming procedures, and self-prescribing. Insurance companies assess risk factors that may impact your ability to work in the future to determine eligibility. It’s imperative for physicians to discuss any potential red flags with their insurance broker and to address any potential concerns prior to beginning the application and underwriting processes. The single best thing you can likely do to avoid a denial situation is to lock in your disability insurance policy early in life before things like injuries or abnormal lab values pop up.
Additional disability insurance resources for physicians
Learn more about disability insurance with:
