Income Protection Journal Podcast

Nancy Cavey often cites a case out of the University of Virginia system, one she did not personally handle, involving a doctor she recalls as an interventional cardiologist. His disability policy defined "occupation" by which medical board he held, and he had not been boarded in that subspecialty. The carrier's answer, in Cavey's telling, was that he could still work, as a cardiologist. She keeps the story close because it shows how completely a policy's own wording can determine whether a physician's disability claim pays.

Cavey is the founder of the Law Offices of Nancy L. Cavey in Tampa Bay, Florida, a Board Certified Workers' Compensation Attorney and certified veterans' attorney who has represented disability claimants nationwide since 1984, working Social Security Disability and private long-term disability claims side by side.

I brought her onto the Income Protection Journal Podcast to run that experience in reverse. Physicians researching disability insurance for physicians usually compare price and the monthly benefit. Cavey's cases are the reminder that the word "occupation" inside that policy can matter more than either number, because at least four different definitions of it exist, and a carrier is free to use whichever one it wrote into the contract.

Own Occupation Has No Fixed Meaning in an Individual Disability Insurance Policy

Cavey walks new clients through the same first question every time: what does this specific policy say occupation means. The Dictionary of Occupational Titles supplies one common definition, and it has not been revised in about 40 years. A local labor market supplies another. A physician's own employer can supply a third. And on the policies Cavey calls the worst she has seen, a medical specialty board supplies a fourth, so a doctor who has not finished a subspecialty exam can be told that a broader specialty still counts as the same occupation.

Physicians rarely carry just one policy, and Cavey said that is exactly where the mismatch shows up.

"Own occupation can mean your own occupation as performed for your specific employer... Now, if you have more than one policy, and I see this commonly, I'll have doctors or physicians or lawyers who have two or three policies, and I'm going from policy to policy to policy because they're all different."
Nancy Cavey, who has handled Social Security Disability and private long-term disability claims side by side for more than three decades, speaking on the Income Protection Journal Podcast

That is the mechanism behind the identical-disability, different-outcome problem. Two policies covering the same physician can each specify occupation a different way, so the same injury or diagnosis can satisfy one contract's definition and fail another's, even though nothing about the physician's condition has changed between the two claims.

https://youtu.be/5KeYqv29l_Y

Physicians With More Than One Disability Policy Face This Twice

This shows up earliest for physicians who build coverage in pieces: a group long-term disability plan through a hospital employer, an individual policy bought during residency or in the first year of practice, and sometimes a third layer added after a partnership buy-in. Each of those was underwritten separately, at a different point in a career, often by a different carrier. Nothing requires the definitions of occupation across the three to match, and Cavey said in practice they usually do not.

The reason it gets missed is not carelessness. A physician buying a fourth or fifth financial product in a single year, on top of malpractice coverage, a mortgage, and a partnership agreement, is trusting a broker to add up the monthly benefit correctly. Cavey has represented CFOs, union stewards, and physicians who could describe exactly how much coverage they were sold and could not describe what the word "occupation" meant inside any of it.

Timing is the part that is hardest to fix after the fact. Reading four separate own-occupation definitions before a disability exists costs an afternoon and, at most, a conversation with an agent about a different rider. Reading them for the first time after a claim has already been filed means living with whatever those definitions happen to say, on top of managing the disability itself.

Cavey said the same blind spot extends past the disability benefit itself, into how a medical practice is structured.

"One of the things I always want to look at is the buyout agreement, because you know normally in buyout agreements there are disability provisions, so the buyout can be different if you're disabled."
Nancy Cavey, a board-certified workers' compensation attorney and certified veterans' attorney who has represented disability claimants nationwide for more than 35 years, speaking on the Income Protection Journal Podcast

A partnership agreement written years before anyone expected to need it can change the value of a buyout the day a partner becomes disabled, the same way an old policy's occupation definition can. Neither document announces the change in advance. A physician learns the actual terms only when a claim forces the question.

Cavey's own introduction to this work came from watching it happen inside her own family, not from a law-school casebook.

"He had enough foresight to buy a disability insurance policy through USFG, never thinking that he would need it. And when I was in junior high school, he was diagnosed with leukemia."
Nancy Cavey, founder of the Law Offices of Nancy L. Cavey in Tampa Bay, Florida, who has represented disability claimants since 1984, speaking on the Income Protection Journal Podcast

Her father was a disabled World War II naval aviator, and the family lived on that policy after he could no longer work the family insurance business he had joined in Maryland. Cavey has spent more than four decades since on the other side of that same kind of policy, reading the definitions that determined whether other families would have the same outcome.

What stays with me is that the outcome of a claim is usually set years earlier, by a choice nobody thought mattered on the day the policy was bought. Before assuming a policy will pay, read what it actually calls "occupation," and read it again in every other policy sitting in the same drawer.

A business owner deducted a disability insurance premium one year, then stopped for the next two once a back injury made a claim look likely. Three years later, an IRS audit reached back and found the year the premium had been written off. Mark Clark did not write the policy, but he watched what happened next from inside his own office.

The audit did not catch a client hiding money. It caught a client who assumed that skipping the deduction in the years he expected a claim would undo what he had already claimed years earlier. It does not work that way, and the tax bill that follows a mistake like that can run into six figures.

I talked through that case with Mark Clark, CFP, founder and president of Prestige Advisors, Inc., a fiduciary tax-planning practice in Lakewood Ranch, Florida, on this episode of the Income Protection Journal Podcast. Mark has spent 30 years building tax-efficient structures for business owners and high-income professionals, and before he moved into tax strategy he spent years placing disability, life, and benefits coverage directly, which is why he can walk through exactly where a disability premium goes wrong on a return.

The S-Corp Bookkeeping Decision That Determines Whether Disability Benefits Are Taxed

Most of Mark's clients who run S corporations pay their disability insurance premium through the business. That alone does not create a problem. What determines whether the eventual benefit is taxed is how the payment is booked, on paper, in two places at once.

It has to be indicated not only on the payroll side on the W-2, but it also has to be on the corporate books where it is a distribution and not a premium expense, and that's the big one for the S corp.
Mark Clark, founder and president of Prestige Advisors, Inc. in Lakewood Ranch, Florida, on the Income Protection Journal Podcast

The premium has to show up as a shareholder distribution in both places, the W-2 and the company's own books, never as a deducted business expense on either one. Miss either side of that and the CPA has effectively deducted the premium anyway, even if nobody meant to. For most owners weighing disability coverage for business owners, this is the paperwork that gets skipped until a claim forces the question.

https://youtu.be/HWmHPEL6mM4

What a $15,000 Insurance Premium Can Cost a Business Owner at Claim Time

Mark walked through the numbers on a case close to his own client base. A business owner in a 35 percent tax bracket pays a $15,000 disability insurance premium and deducts it, then goes on claim for a $100,000 monthly benefit.

So that $5,200 tax savings would cause a $100,000 benefit to be taxable at 35%, so that's a $35,000 tax bill. So you're saving a $5,200 tax bill to potentially pay a $35,000 tax bill, and that could be year after year.
Mark Clark, a certified financial planner who has spent 30 years advising high-net-worth families, on the Income Protection Journal Podcast

A ten-year claim turns that $35,000 into $350,000, all to protect a deduction worth $5,200 in the single year it was taken. Mark has a phrase for this trade he uses often, asking whether the orange is worth the squeeze. On a disability insurance premium, in his telling, the juice never covers the cost.

Why the IRS Audit Reached Back Three Years for One Disability Insurance Premium

The bookkeeping mistake described above is not always accidental. Mark told me he has watched a business owner try to walk what he calls a tightrope, deducting the premium in a year with no claim in sight and skipping the deduction the moment a claim looks likely. He does not recommend it, and the one time he watched it up close, it did not hold.

They went back three years and they had deducted the premium three years prior. They hadn't done it the last two years, and the reason they hadn't done it is because they felt that something was going on with them where they had the disability, and this was a back injury.
Mark Clark, a Qualified Kingdom Advisor who works on the tax structure behind other people's businesses, on the Income Protection Journal Podcast

The client was already a higher audit risk simply by earning enough to draw attention, Mark said, and the audit reached back far enough to find the one year the premium had been deducted. That single year was enough to make the related benefit taxable, exactly the outcome the client had spent two years trying to avoid.

None of this is about whether a group disability plan reaches an owner's K-1 income in the first place. A related question, whether a group plan's covered-earnings definition counts distributed S-corp income toward the benefit at all, is a separate issue covered elsewhere. What Mark is describing here happens after a benefit is already in place: the premium's own paper trail determines whether that benefit arrives tax-free or gets added to the owner's income at claim time.

Mark's advice to every S-corp client is the same, in the end: never deduct the disability insurance premium, because the benefit on the other side is worth far more than the deduction ever was. The tax treatment of a disability benefit is settled years before anyone files a claim, by a decision that looks like paperwork at the time.

Most practice owners have never priced what it would cost to keep a practice's bills paid if the owner could not work. In 2020, Maxwell Schmitz's mother needed a lung transplant. For decades she had run the underwriting and case-management side of the family's insurance agency, the person who reviewed every application before it went out the door, and her family had to decide, in the middle of that, what happened to her paycheck.

I talked through that decision with Maxwell Schmitz, President of Yetworth Insurance Solutions, a wholesale disability brokerage his family has run for three generations out of San Rafael, California, and a past president of the International Disability Insurance Society, on this episode of the Income Protection Journal Podcast. His mother's own individual disability policy meant the agency never had to pull her salary out of the business to cover her. That money stayed in, and the family used it to hire someone new and automate some of the work she used to do by hand. What her family did not have, and what most business owners in the same position still do not have, is a second policy built to cover everything else a practice needs to keep running while the owner is out.

The Difference Between an Individual Disability Policy and a Business Overhead Expense Policy

Maxwell told me the mix-up he runs into most often is between two products that sound alike but pay two different bills.

Key person typically denotes that this is going to be a non-owner employee, and then that you know, if they go down, if that non-owner employee goes down, the benefits are paid to the business to then find a replacement... The key person policy, whereas a business overhead expense policy is designed to just protect the business owner. If that person can no longer operate the business, then it will come in and pay the salaries, the benefits, keep the lights on, the mortgage or the rent, you know, and any other sort of regular equipment that the firm or practice or clinic needs to keep operations running smoothly.
Maxwell Schmitz, President of Yetworth Insurance Solutions, a wholesale disability brokerage his family has run for three generations, on the Income Protection Journal Podcast

The distinction matters because owners often assume one policy does both jobs. It does not. An individual disability policy, which is what covered his mother, replaces the income the owner would have earned. A separate overhead expense policy for the practice pays the practice's own bills instead, rent, payroll, malpractice premiums, and equipment, while the owner recovers. Maxwell has watched the two get confused often enough that a business owner ends up asking a carrier for what is really a key person benefit, and the reverse happens just as often. They are not interchangeable, and a practice that buys only one of the two still leaves the other side uncovered.

https://www.youtube.com/watch?v=pBiGPHSsfdY

What a Solo Practice Loses Without Overhead Expense Coverage

Maxwell walked me through why overhead expense coverage matters most for small, owner-dependent practices, the kind with one clinician and a small staff behind them.

If you can't have the dentist seeing people, then of course revenue is going to dry up, and when revenue dries up, you can't pay the employees, and those employees are going to have to go work for the dentist down the street.
Maxwell Schmitz, past president of the International Disability Insurance Society, on the Income Protection Journal Podcast

That is not a hypothetical for Maxwell. His own family's agency runs on five people, and he watches the same math inside his own business. A practice does not lose revenue gradually when the person who generates it stops working. It stops close to immediately, and staff without a paycheck do not wait around to see whether the practice recovers before they take a job somewhere else.

Why the Individual Disability Policy Comes First

Given how much of Maxwell's own work is designing overhead expense cases for advisors, I expected him to lead every conversation with the product he sells the most. He told me the opposite is true.

Instead of leading straight to the business overhead expense conversation... What gets overlooked, I think, in the BOE conversation is how relevant and important the individual disability insurance policy is.
Maxwell Schmitz, MSFS, CLTC, DIA, on the Income Protection Journal Podcast

His reasoning traces back to his own family's experience. His mother's individual disability policy did more for the business than either of them expected going in, because it meant her paycheck never had to come out of the agency's revenue in the first place. Business overhead expense insurance is worth what it costs, Maxwell said, but it solves a narrower problem than most owners assume, and it should never be the first conversation a practice owner has about disability coverage.

Maxwell's family found out, in the middle of an actual medical crisis, exactly which policy did what. Most practice owners find out the same way, after something has already gone wrong. If a practice's disability coverage has never been checked against the specific bills an overhead expense policy is built to pay, rent, payroll, malpractice premiums, and the loans and equipment leases that do not pause just because the owner is out, that is the conversation worth having before there is a real deadline attached to it.

For an attorney relying on a law firm’s group disability plan, coverage for the exact same injury can play out two completely different ways depending on how long the disability has lasted. Most group long-term disability policies define disability one way for the first two years of coverage, and a different way after that. For those first 24 months, you qualify as disabled if you cannot perform the material and substantial duties of your own occupation. After 24 months, the definition typically shifts to any occupation, meaning any occupation you could reasonably do given your training, education and experience. Nothing about the underlying condition has to change for the benefit to stop. Only the definition does.

I explored exactly why that switch happens, and why it doesn’t happen under every policy, with Edward Dabdoub of the Dabdoub Law Firm in Coral Gables, Florida, on this episode of the Income Protection Journal Podcast. Edward has spent years studying how disability insurance policies define who qualifies as disabled, across every profession he represents.

The Own-Occupation-to-Any-Occupation Switch, and Why It Applies to Attorneys Too

A law firm partner or associate on a group plan faces this identical mechanism. Coverage holds at the own-occupation standard for the first 24 months, then converts to the broader any-occupation test, whether or not anything about the underlying condition has changed. Edward’s clearest illustration of how that conversion actually plays out came from one of his clients, a dentist who developed a tremor severe enough that dental work was no longer safe to perform.

For two years, the dentist’s policy paid a full benefit, because it defined disability as being unable to do the specific work of dentistry. Then, on schedule, nothing about the tremor changed, but the payments did. A dentist who can no longer hold instruments steady can often still teach, consult or manage, and the moment an insurer decides that’s true under an any-occupation standard, the group benefit ends. The definition switched. Nothing about the dentist’s hands did.

That’s the mechanism every attorney on a group plan needs to check for in their own firm’s certificate, and it’s the switch Edward has watched play out again and again with clients like the one above.

So if that dentist had an own occupation insurance policy, an individual insurance policy, they would be able to find another occupation other than dentistry, and continue to get paid a full total disability benefit and essentially reinvent their career doing something else. They don’t just have to stay. I tell my client, you don’t have to stay home watching reruns of Oprah all day.
Edward Dabdoub, managing partner of Dabdoub Law Firm in Coral Gables, Florida, on the Income Protection Journal Podcast

Under an individual, true own-occupation policy, the definition Edward is describing never changes. What’s insured is the ability to perform your own occupation specifically, not some other occupation you could theoretically be retrained for. That single difference in policy language is the entire reason two professionals, a dentist and an attorney alike, can face the identical disability and end up in two entirely different financial positions two years later.

Edward has seen the group-plan version of that story more than once.

The group insurance policy is different because after 24 months, the insurance company will likely terminate those benefits because they would take a position that well, there are other things you can go and do now, and many professionals were wired a certain way where we don’t want to stay home if we’re disabled, and we want to reinvent our careers. And so my clients were dentists. Some of them going to teaching, but if you have a group insurance policy that has that definition of disability change from own to any after 24 months, well, when you move into teaching, you’re not going to continue getting paid after 24 months.
Edward Dabdoub of Dabdoub Law Firm, who has spent years studying how insurers write disability definitions, on the Income Protection Journal Podcast

Notice what actually disqualified those dentists from further group benefits. It wasn’t that they recovered. It was that they found a second career, exactly the kind of resilience a group plan’s own-to-any definition treats as proof the benefit is no longer needed.

https://youtu.be/dXe05mgp7yQ

What This Means If a Firm’s Group Plan Is Your Only Coverage

Attorneys hear this dentist story and assume it doesn’t apply to them, because practicing law rarely depends on fine motor skill the way dentistry does. But the definition-switch mechanism Edward described isn’t written for one profession. It’s built into the policy language of most employer-sponsored group long-term disability plans, including the ones law firms buy for their partners and associates. An attorney disabled by a condition that keeps her from trying cases or negotiating at the pace her practice demands can qualify for the full benefit for two years under the own-occupation standard, then lose it once an insurer decides she could reasonably do a different kind of legal or non-legal work instead.

A law firm partner who has never looked past the group plan’s summary page usually assumes coverage is coverage. It isn’t. The same 24-month definition switch that reclassified Edward’s dentist clients into teachers applies to a partner who could plausibly shift out of the courtroom and into compliance work, or an associate attorney who could move into a different practice area. Because the group plan’s benefit is typically capped as a percentage of salary and tied to the firm’s own group contract, a partner or associate has no ability to negotiate that definition individually. It comes with the plan, own to any, at 24 months, whether the attorney knew that going in or not.

Solo practice presents the opposite problem. Without a firm behind them, there’s no group long-term disability plan at all, own-occupation or any-occupation, unless a solo attorney has bought individual coverage separately. For a solo practitioner or a partner who wants the definition of disability tied to their own occupation to hold for the life of the policy rather than for exactly 24 months, an individual disability policy is the only structure built to do that.

What to Check Before You Buy or Renew

This is the question worth asking before you buy or renew any policy, group or individual. Does the definition of disability in this contract change at any point, and if it does, when and to what. It’s a short question to put to a broker, and it’s the difference between coverage that protects your ability to practice law specifically and coverage that only protects you until an insurer decides you could do something else instead. It’s also the exact comparison we walk through when an attorney is comparing disability insurance for attorneys, definition by definition, carrier by carrier.

Edward put the stakes plainly when I asked him what he’d want every law firm partner who assumes the firm already has this covered to hear.

I think it would be individual disability insurance is king, right? Relying on group disability insurance means you’re both underinsured and not going to have the worth at all that you will on with an individual insurance contract. These are two completely separate insurance policies.
Managing partner Edward Dabdoub of Dabdoub Law Firm in Coral Gables, Florida, on the Income Protection Journal Podcast

They are two completely separate insurance policies, and only one of them keeps its promise on the same terms two years, ten years or twenty years into a disability. The dentist who lost his benefit at month twenty-five didn’t lose his tremor. He lost his definition. Before you assume your own disability insurance for attorneys will hold up the same way ten years from now, find out which definition you actually have.

Michelle L. Roberts has represented disability claimants since 2005. She explains what a new employer's group plan does with a condition you already have.

An owner who runs a practice or a company as an S corporation pays themselves a modest base salary, takes the rest of the year's profit as a K-1 distribution, then enrolls in the group long-term disability plan and treats the income question as settled. Most group disability plans never saw that distribution, because they define covered earnings as W-2 wages and stop there. Under that definition, the largest number on the owner's tax return was never insured.

Grayson Owen has spent more than 12 years in the insurance business, and he now works in a corner of it most buyers never see. He is a disability income wholesaler at DI Broker East, which means advisors across the Mid-Atlantic, the Southeast and the rest of the country route their hardest income protection cases through him, the executives, partners and owners whose earnings a lot of other people depend on. He told me S corp owners make up most of the business owner files that reach his desk.

Covered Earnings Definition Inside S Corp Owner Disability Insurance

Covered earnings is the single line in a group long-term disability contract that sets the ceiling on any benefit it will ever pay. Most employer plans define it as W-2 wages, sometimes averaged across a stretch of months before the disability began. Profit distributed out of the S corporation sits outside that definition unless the plan was deliberately designed to reach it. The replacement percentage printed on the front of the plan document, usually 60 percent, gets applied to whichever number the definition allows.

That modest salary line has a reason behind it. The Internal Revenue Service requires an S corporation officer who performs services for the company to be paid reasonable compensation as wages before non-wage distributions are made, and owners and their accountants typically set that wage at a defensible floor and route the remaining profit through the K-1. That is ordinary tax planning. It is also the number a group carrier reads when it calculates a disability benefit.

Owen sees the result of that arithmetic in six and seven figures.

"A lot of the S corp owners might have very significant six figure, even seven figure K-1 distributions. That's basically their business profit, how I understand it. I'm not a tax advisor, but K-1 is a type of income that the S corp owner distributes usually at year end, and those earnings may or may not be covered under the group plan depending on how they design it."
Grayson Owen, a disability income wholesaler at DI Broker East who has spent more than 12 years in the insurance business reviewing owner-employee disability cases for advisors, speaking on the Income Protection Journal Podcast

"May or may not" is the operative phrase, and it is settled inside the plan document long before anyone gets sick. Almost no owner-employee has read that answer. The percentage is the number they remember, because the percentage is the number the enrollment material leads with.

If you own a dental practice, a law firm, a medical group or a construction company organized as an S corporation, this is your plan too. Most owners approve the group disability plan once, when it is first installed, often back when the company was smaller and the salary line was closer to the whole paycheck. Profit grows after that. The distribution grows with it. The covered earnings definition does not move.

Owners also miss it because the group plan reads like the more generous of the two products. Sixty percent replacement sounds close to whole. An owner drawing a $100,000 salary against a much larger K-1 hears 60 percent and pictures 60 percent of what the household actually lives on. The contract is measuring wages, and the household is spending income, and those two words point at very different numbers on the same tax return.

Here is the arithmetic I walk owners through. Say the owner pays themselves a $100,000 base salary and takes $900,000 in distributions, a common shape for a profitable single-owner professional company. Under the group policy, only that $100,000 counts as covered earnings, while the household is running on the full $1 million. An individual disability policy is what reaches the rest, because individual carriers underwrite total earned income and will issue a benefit that sits on top of whatever the group plan already pays. The group plan will not pay on the $900,000 no matter how the claim is filed.

https://www.youtube.com/watch?v=yKgx8b3Eeto

Individual Disability Insurance for Business Owners Picks Up the K-1 Income

Individual policies reach the distribution because they measure income differently. Financial underwriting on an individual contract looks at total earned income, which for an S corporation owner-employee means the W-2 line and the K-1 line read together, usually across two years of returns. That is the number the benefit is built on. It is also why the application asks for tax returns rather than a pay stub.

There is a second route Owen spends much of his executive time on, and it changes who pays. A company can install a layer of individually owned coverage on top of the group plan for a defined class of people, issued with limited or no medical underwriting. Carriers will generally look at a class as small as five lives, and Owen said most of the private-company cases he manages run somewhere between five and 40 people, frequently family businesses with a core management team. Some designs true everyone up to the same replacement percentage. Others carve out a class by title, so anyone hired or promoted into it becomes eligible on arrival. Those policies are individually owned and portable, which matters more than most executives realize on the day they leave.

The reason so many owners never learn any of this, Owen argues, is that the conversation stops one question too early. An advisor asks whether the client has coverage at work, the client says yes, the box gets checked and the agenda moves on.

"We want them to say, 'Hey, do you have coverage through work?' The client's going to probably say yes or no or I don't know, and then after that, would you mind if we review that plan for you to make sure you're okay?"
Grayson Owen, who spent nearly a decade as a consumer-facing insurance broker before moving to the wholesale side, where he now runs disability coverage reviews for advisors and their clients, speaking on the Income Protection Journal Podcast

That second question is where the review actually starts. Reading the plan document is what surfaces the covered earnings definition, and that definition is what decides whether an owner is insured on a salary or on a paycheck. Nobody finds it by asking whether coverage exists, because it does exist. It just does not reach as far as the owner believes.

So the practical move for an S corporation owner is narrow. Pull the certificate of coverage for your group long-term disability plan and find the covered earnings or covered monthly earnings definition. Read whether it says W-2 wages, base salary or total compensation, and whether the plan document mentions K-1 distributions anywhere. Then set that number next to what you actually reported as income. When I build income protection for small business owners, that comparison is the first page of the analysis, because everything downstream depends on which number the contract agreed to insure.

Timing decides the rest of it. Individual coverage is medically underwritten, and the owner who waits until the practice is at peak profit is also the owner who has accumulated the health history that shapes the offer. Owen made that point about himself on the record, naming his own diagnoses.

There is more in the recorded conversation than fits here, including the two medical policies another broker wrote without residual disability or true own-occupation language and what it took to rebuild them, what happens inside underwriting when a file was never pre-screened, and the one line Owen would put on a billboard for every owner who assumes the business will simply keep paying them. That conversation is on the Income Protection Journal Podcast. What stays with me is that the definition nobody reads is the one that sets the check.

Alkeme Insurance EVP John DePinto, 30 years on the property and casualty side, on the one policy the state, your bank and your job never make you buy.

An employee signs up for disability coverage during open enrollment, checks the box, and assumes the benefit will stand in for a paycheck if illness or an accident ever stops the income.

It does step in, but the check that arrives replaces less than half of what the household was taking home, once the formula, the cap, and the tax treatment all land. Most people never learn that math until they are already on claim, which is the worst possible moment to discover it.

I hear that assumption in almost every first conversation I have with a working professional. To pressure-test it, I sat down for the Income Protection Journal Podcast with Andy Schafer, Vice President of Workplace Benefits Solutions at Principal Financial Group, who spent 24 years as an actuary pricing disability risk before moving into product development for Principal's Specialty Benefits Division.

His job for more than two decades was to calculate, across millions of insured lives, how often working people lose their income and what it costs to replace it. When someone who priced that risk for a living tells you what the payout actually looks like, the number is worth sitting with.

Andy walked through the arithmetic without softening it. Employer-sponsored coverage typically replaces 60 percent of pre-disability earnings, and that replacement is calculated on pre-tax income, not on the take-home figure a professional actually lives on.

Why Most Disability Claims Are Sickness, Not Accidents

The other assumption Andy spent years watching the data contradict is the picture people carry of what a disability even is. Insurance marketing leans on crutches, wheelchairs, and hospital imagery, which trains the public to file the risk under accidents. The claims experience runs the other way.

"Accidents are only 10 percent of the disabilities that we cover. The other 90 percent are sicknesses."Andy Schafer, Principal Financial Group, on the Income Protection Journal Podcast

That ratio reframes the entire buying decision. A professional who reasons "I work on a computer, so I can push through an injury" is answering the wrong question, because the medical conditions that actually drive disability claims are cancers, cardiac events, autoimmune disease, and the cognitive fog that arrives with serious illness.

Andy made the point that being physically able to sit at a desk means little when illness makes it impossible to think, concentrate, or stay awake through a working day. The 90 percent share belongs to sickness, and sickness is precisely the risk people talk themselves out of.

Sitting with the claims data for a career also taught Andy how rarely the event arrives at all, which is the second half of the psychology.

"About three and a half to four out of every 1,000 people that we insure actually file a claim."Andy Schafer, Principal Financial Group, on the Income Protection Journal Podcast

A frequency that low feeds the sense of invincibility that keeps professionals from acting. Andy was candid that the "I will never need it" instinct is statistically true for most people in any given year, and that the industry has leaned too hard on fear to sell against it.

The rarity is real. So is the size of the loss when the rare event lands on one household instead of a thousand.

What Individual Disability Insurance Adds to a Workplace Policy

Two forces have quietly lowered how often working people file. The pandemic normalized remote and hybrid work, and Andy described how that reshaped the risk.

A worker recovering from a stage-two cancer diagnosis who once would have filed for short-term disability, because coming into an office was impossible, can now often keep contributing part-time from home. People return to work faster, and sometimes never leave it, which pulls claim frequency down and, in turn, brings the cost of income protection down for everyone in the pool.

That good news for pricing does not fix the shortfall inside a single household when a serious sickness does stop the income. This is where I spend most of my time as an advisor.

After three decades placing coverage for professionals, the same correction comes up again and again, and Andy landed in the same place from the carrier side: take a hard look at the benefit summary before you need it, and if the employer-sponsored replacement leaves a household living on less than half its prior income, that is what individual coverage is built to close. An individual disability income policy stacks on top of the group benefit, can lift total replacement toward 70 percent of pre-disability earnings, and moves with the professional from job to job rather than ending the day they change employers.

Portability is the piece that Andy, who spent his entire career at one company, flagged as the modern blind spot. Most working professionals now change jobs several times, and each move resets the group coverage. A new employer may offer a weaker benefit, or none, and a health change in the interim can foreclose the chance to buy individual coverage on good terms.

That is the argument for purchasing young, while insurability is intact and premiums are lowest, and for owning a policy the employer does not control. The full conversation, including the soundbite round where Andy names the odds a 35-year-old actually faces, is worth hearing in his own words on the Income Protection Journal Podcast.

Most attorneys who buy disability coverage believe own occupation guarantees their benefit the day they can no longer practice law. It is an umbrella term with tiers, and the version inside a group plan, or an individual policy bought without the right rider, pays very differently. Which tier an attorney owns decides whether the disability claim pays in full or drops to a fraction the moment it is filed.

Ethan Abramowitz has watched that decision play out from both sides of the table. He spent nearly four years defending insurance carriers at Kirwan, Spellacy and Danner before joining Mark F. Seltzer and Associates, a national practice representing highly skilled professionals in private and group disability matters, where for more than 13 years he has represented physicians, dentists and attorneys whose claims were denied or stalled.

Admitted in Florida, Pennsylvania and California, he meets these professionals years after the policy is signed, at the moment the carrier says no. I brought him onto the Income Protection Journal Podcast to work the story backward, from the denied claim to the contract language that caused it.

Own-Occupation Coverage Separates an Attorney's Full Benefit From a Modified Trap

The phrase attorneys think they understand is the phrase that fails them most often. True own occupation, sometimes called regular occupation, pays the full monthly benefit when a sickness or injury stops you from practicing law, even if you go earn a living doing something else.

A modified own-occupation definition pays only while you are not working at all. Step back into any paid work and the claim collapses into a partial or residual analysis, the reduced benefit paid when you can still work but earn less.

Own occupation, it's an umbrella term, and underneath that, there's different tiers of coverage.
Ethan Abramowitz, a disability insurance attorney with Mark F. Seltzer and Associates for more than 13 years, speaking on the Income Protection Journal Podcast

He watched the difference cost one physician most of her income. An OB/GYN in her late 30s developed rheumatoid arthritis, lost her clinical career and accepted a medical directorship with the residency program she had trained in.

Because her individual policy carried a modified own-occupation definition rather than a true one, her earnings from the new role were offset against her benefit. The monthly check fell from $15,000 to two or three thousand. A true own-occupation policy would have paid the full $15,000 alongside her new salary with no offset.

Attorneys assume this is a doctor's problem because a surgeon's disability looks obvious. It is not.

Abramowitz has represented lawyers with Parkinson's disease, traumatic brain injuries and visual impairments who could no longer tolerate the physical and cognitive load of the work, the ability to sit for 10 or 12 hours, read voluminous records and hold a trial schedule together. When a lawyer with that kind of condition wants to teach or consult instead, only a true own-occupation definition lets the benefit and the new income coexist.

If I can't be a lawyer, but I could go teach at a law school as an adjunct professor, I can do that and earn a living and do something I'm passionate about. Without the true own-occupation definition, I can't do that without having an offset.
Ethan Abramowitz, who represents policyholders in disputed disability claims, speaking on the Income Protection Journal Podcast

Group Long-Term Disability Converts an Attorney's Own-Occupation Term After 24 Months

The group plan a firm provides is where most attorneys assume they are covered, and it is where the definitions quietly turn against them. An individual policy weighs the material and substantial duties of the occupation as you actually perform it, examining your billing records and your day-to-day work. A group long-term disability plan leans on a national-economy standard drawn from reference works like the Dictionary of Occupational Titles and O*NET, generalized rubrics that ask what a lawyer does, not what you do.

The costlier problem sits deeper in the contract. Most employer plans limit own-occupation protection to the first 24 months, then shift the standard to any gainful occupation. When the policy does not spell out a replacement-income formula, that phrase defaults to the Social Security definition of disability.

I always joke that if you can be a barista at Starbucks, no disrespect to them.
Ethan Abramowitz, a former insurance-defense litigator who spent nearly four years defending insurance carriers, speaking on the Income Protection Journal Podcast

Then the carrier can argue you are not disabled. A greeter's wage clears the bar. Group plans answer to the Employee Retirement Income Security Act, a federal statute that tilts the burden toward the carrier and forces a denied claimant through an internal appeal before any courtroom is available.

Covered monthly earnings compound the shortfall. Many group plans count only base salary and exclude bonus, incentive and production pay. Abramowitz described an orthopedic surgeon earning about $800,000 who returned to work at half time.

His individual policies paid a 50 percent partial benefit. His group plan, measuring only base compensation, required a 60 percent loss of total earnings before it paid anything, so it paid nothing. Attorneys on a modest salary and a large bonus face the same arithmetic.

Four Attorney Disability Policy Features That Decide the Claim

Asked which single feature he would refuse to give up on a policy of his own, Abramowitz did not hesitate. The true own-occupation definition comes first, followed by residual disability, a future increase option and a cost-of-living adjustment. Roughly 60 to 70 percent of his cases involve some component of partial disability, and only about 10 percent of disability claims trace to an accident, so the provisions that pay while you are working less matter far more than most buyers expect.

Attorneys rate among the most favorable occupation classes for pricing, alongside architects, accountants and engineers. When I build individual own-occupation coverage for attorneys, I treat that pricing advantage as a reason to add the strong features rather than to buy the cheapest contract, because the group plan the firm owns can be cut or canceled at any renewal and does not follow you when you leave. Abramowitz put the same point on a billboard.

No attorney should sign a disability policy until they have read the fine print.
Ethan Abramowitz, who has represented physicians, dentists and attorneys in denied disability claims for more than a decade, speaking on the Income Protection Journal Podcast

The same math decides it for solo practitioners and firm partners, the attorneys with no group plan behind them at all. On the r/personalfinance forum, a self-employed single parent asked whether an own-occupation policy is worth the higher premium, and whether a benefit that runs to age 65 makes sense. Abramowitz did not hedge.

Absolutely. If you're self-employed and you're a single parent or a single income household, you're the breadwinner. You need to protect your income.
Ethan Abramowitz, who has litigated insurance disputes from both the defense and policyholder side for more than 15 years, speaking on the Income Protection Journal Podcast

The full conversation, including his account of a surgeon who kept operating with tremors because he could not afford to stop, and the elimination-period and pre-existing-condition traps that decide a claim before it is filed, is on the Income Protection Journal Podcast. What stays with me is that the outcome of a claim is usually written years earlier, on the day the policy is bought.

Editor's note: I refer clients to Ethan Abramowitz when a disability claim is disputed, and some of the professionals he represents hold coverage I placed. Neither of us pays the other for referrals, and he received no compensation for this interview.

Group long-term disability through your employer typically pays $2,000 to $15,000 a month before tax, far less than what high-income working professionals actually earn. Independent insurance broker Analisa Cleland explains the four-part group LTD trap, the worksite-product portability path for the uninsurable, and why 92 percent of brokers licensed to sell disability insurance don't.

Gretchen Rosenberg has watched agents at her brokerage get sick, stop working, and find out how little income protection they had.

When that happened, colleagues sometimes stepped in. They covered showings, managed contracts, and kept deals from unraveling. What they could never replace was her paycheck.

Five years ago, Rosenberg launched a foundation at Kentwood Real Estate that provides emergency grants to employees and agents dealing with cancer, car accidents, and medical crises. It has made a real difference for a number of people.

It is not income protection for self-employed professionals. And Rosenberg says not enough of her agents carry one.

Rosenberg is President and CEO of Kentwood Real Estate, a luxury brokerage serving communities across Colorado’s Front Range from Denver to Boulder, Fort Collins to Colorado Springs, and into the mountain communities of Summit and Grand counties. Kentwood is Colorado’s exclusive affiliate of Home Services of America and one of the largest residential real estate companies in the country. She started her career as a single mother, spent six months without closing a sale, and built her way to leading one of the state’s largest brokerages over nearly 30 years in a production-only industry.

I sat down with Rosenberg on the Income Protection Journal Podcast to talk about what she has observed across those three decades: what commission earners assume will protect them when something goes wrong, why those assumptions often fail, and what she did about her own income when she was just starting out and could least afford to be unprepared.

Commission Income Has No Floor and No Benefits

Real estate agents are independent contractors. Nearly all of them file 1099s, pay their own taxes, and carry no employer benefits. No health insurance.

No life insurance. No 401K unless they build one themselves.

“The agent is responsible for paying all their taxes, all their insurance,” Rosenberg says. “They have no benefits, they have no health insurance. It’s all on them.”

What makes this particularly difficult is the gap between perception and reality. Television shows about real estate create the impression that agents are uniformly wealthy. The reality, Rosenberg says, is that most agents pay listing marketing costs out of pocket before they know whether a house will sell.

Every deal is speculation. Every paycheck is earned from scratch.

Commission income does not come with a floor. It comes with cycles, market shifts, slow seasons, divorces, and bodies that eventually wear out.

Rosenberg has watched agents navigate all of those. What carries the successful ones through, she says, is almost never what they assumed would.

“They’re out there protecting their clients, and they forget to protect themselves,” Rosenberg says.

What Illness Actually Does to a Commission-Based Income

When I asked Rosenberg what she has seen happen to agents who fell ill or were injured and could not work, her answer was direct.

“I’ve seen some really sad things happen, and it’s because they’re unprepared,” she says. One agent Rosenberg knows lost her home to IRS liens after spending a commission check before setting aside her estimated taxes. Others who were struck by illness had no reserve to carry them through a year of reduced or no income.

The Kentwood Cares Foundation fills some of the gap. But a grant to get through a rough month is a different instrument than coverage that replaces months or years of income when a medical condition prevents someone from working. Most commission earners Rosenberg knows do not have the second thing.

“Not enough think about it,” she says, when I asked whether agents in her firm protect their income. “I think they think, ‘I’ll always be able to sell a house.’”

That mindset is understandable. Real estate attracts people who believe in their ability to hustle. It is also, Rosenberg says, a physically demanding job.

Agents pull up carpet corners at inspections, climb stairs at showings, and work weekends and evenings for clients whose timelines rarely align with anyone’s preferred schedule. The ability to do that work is not guaranteed indefinitely.

What High Earners Assume Will Be Enough

A common belief among high-earning self-employed professionals is that savings or investment portfolios will carry them through any disruption. The most financially disciplined agents at Kentwood, Rosenberg says, do invest well and are genuinely prepared. Most are not those agents.

Housing equity is at an all-time high nationally. But equity does not replace income when someone cannot work. It takes time to access, selling under duress is rarely good timing, and drawing down assets is not the same as having coverage that pays a monthly benefit during a disability.

Rosenberg’s advice to anyone transitioning from a salary into commission-based work is to have at least $25,000 to $30,000 in cash reserve before starting. Even after closing a deal, the commission may not arrive for months.

“That’s why we have insurance,” she says.

I work with self-employed professionals and independent contractors on individual disability insurance built around the income their work generates. The policies that protect commission earners are structured differently from group plans, and understanding those differences matters before something goes wrong.

Rosenberg got her own policy in the early months of her career, when she had no income and no certainty about when she would close her first sale. She was a single mother starting over. She has never needed to file a claim.

“I’m always grateful I have it,” she says.

The specifics of what Rosenberg has seen happen to commission earners who prepared and commission earners who did not, and the conversation she and I had about the gap between earning well and being protected, are in this episode of the Income Protection Journal Podcast. It is a conversation worth hearing before the need arises.

A doctor who could no longer practice medicine after a neurological diagnosis started painting watercolors and selling them to make up what his disability benefits did not cover. His policy had been sufficient when he first bought it, but his income had grown beyond what the coverage was designed to replace, and no one had reviewed it in the years between. Bob Herum was a young agent at Provident at the time, delivering benefit checks to that doctor’s door, and one of those watercolors has hung in his hallway ever since.

The shortfall is the story. Disability income insurance replaces a percentage of prior earnings rather than all of them, and that gap is what sends people looking for a second income.

Herum is the president of the Council for Disability Income Awareness, a nonprofit whose mission is to make sure working Americans understand what income protection is before they need it. He entered the disability insurance business in 1986 after eight and a half years of military service, spent fourteen years as a vice president of sales and marketing at Provident, one of the country’s largest disability carriers, and has spent the past two and a half years rebuilding the CDIA after the organization went through a difficult leadership transition. The CDIA, which recently added the word “income” to its name to distinguish its mission from general disability services, now reaches nearly 40,000 agents and advisors and has expanded its membership to include Munich Re, major general agencies such as Ash Brokerage and DI Brokers East, and carrier members including Principal, Unum, and Lincoln Financial.

I sat down with Herum on the Income Protection Journal Podcast during Disability Insurance Awareness Month to talk about the painting, the doctor, and what he has observed across four decades watching what happens when working Americans are covered and when they are not. It is a conversation I plan to return to.

The Gap Most Workers With Group Coverage Have Never Thought to Check

The story of the watercolor doctor is not unusual. The disability does not always arrive with drama.

It comes from a neurological issue, a cancer diagnosis, a hand injury, a joint that stops cooperating. What makes it costly is the gap between what a worker assumes their coverage does and what the certificate of insurance actually says.

Most workers with employer-provided coverage have never read that certificate. Herum spent ten years marketing group long-term disability and short-term disability products, and he is direct about what most of those plans do and do not cover. The benefit is typically 60 percent of base salary, calculated only on compensation from that employer.

The portion the employer pays is taxable as federal income tax. And the coverage does not follow the worker if they change jobs.

“Do you realize that if you leave that employer, that coverage stays with the company? It doesn’t travel with you,” Herum says.

Most group long-term disability plans also include a provision that, after an initial period, shifts the definition of disability from inability to perform your own occupation to inability to perform any occupation at all. For a physician, attorney, or specialist whose income depends on a specific set of skills, that shift matters.

Herum’s consistent message is not that group coverage is inadequate across the board. It is that very few workers have taken the time to understand what they actually have.

The organizing idea behind the CDIA is that most people do not make a conscious decision to leave themselves unprotected. They make an unconscious one.

They receive an enrollment form at work, they mean to look into it, and they never do. “Their lack of planning becomes their plan,” Herum says.

The statistic the CDIA returns to is not an abstraction. A Milliman study confirmed what Herum first encountered in 1986: one out of four working Americans will experience at least a 90-day disability during their working career. “If I knew that there was a 25 percent chance that when I crossed the road, I was going to get hit by a car, I probably wouldn’t cross the road,” Herum says.

The problem is not that people reject the risk when they confront it. The problem is that most people never confront it clearly enough to make a real decision.

The Resources the CDIA Makes Available to Agents and Working Americans

The tools the CDIA produces are free and available at cdia.org. For agents and advisors, there is a database of nearly 40,000 professionals receiving regular outreach, a library of more than 900 blog articles organized by coverage topic, training sessions focused on specific policy mechanics, and marketing materials designed to support client conversations year-round. For the working American who lands on the site, the CDIA is building video content designed to help answer a basic question: what do I actually have, and is it enough?

One newer program certifies employers whose disability benefit offerings meet a defined standard. Herum envisions the database becoming a tool workers use when comparing job offers, letting them see which employers have built a real disability program rather than a nominal one.

The first certificate was awarded days before our conversation. Carriers including Unum are already marketing the program to their employer clients.

I work with high-income professionals and self-employed individuals on individual disability income coverage built around the specifics of their occupation and income. The coverage I place is structured differently from what most group plans provide, and understanding those differences before something goes wrong is exactly what Disability Insurance Awareness Month is designed to prompt.

Herum’s framing is that every month should carry that prompt. May is the annual occasion to raise the conversation. The CDIA’s job is to make sure the conversation keeps happening in June, October, and January as well.

The full conversation, including Herum’s account of a second claim story from his early career in Columbus involving a dentist who redirected his career to managing practices after his own disability, and his view on why only four out of every 100 licensed agents discuss disability insurance with their clients, is available on the Income Protection Journal Podcast. The resources he describes are at cdia.org.

A physician with fifteen years in clinical practice and a dual household income had the financial plan most parents assume they have. She had started a 529 college savings account before her daughter was born, carried benefits through a large integrated health system, and expected a pension to grow alongside her career. Then her marriage ended when her daughter was five, and the plan she had counted on needed to hold for one.
Two incomes had been doing the work of one plan. Individual life insurance is priced on the earner it names, so a household that loses one salary discovers what the other policy was actually sized for.

Dr. Katie Richardson is a board-certified pediatrician and the CEO of Lantern, a Colorado-based national nonprofit that delivers childhood development resources to more than 500,000 families across the United States through text messaging. More than 65 percent of those families live in low-income zip codes, giving Richardson a data-informed view of financial disruption at scale that few clinicians can match. She joins me on the Income Protection Journal Podcast to discuss what two decades of working with families, and one personal financial disruption, taught her about building financial security that survives the unexpected.

What Families Build For and What They Miss

Richardson’s work puts her inside the financial lives of families across the economic spectrum. Through Lantern, she oversees programs reaching families in more than 30 states. She also draws on fifteen-plus years of clinical observation watching middle-class and upper-middle-class families make healthcare decisions based on cost and coverage rather than clinical need alone.

A 2024 advisory from the Office of the Surgeon General on parental stress confirmed what Richardson had already observed at scale: financial pressure shapes how parents show up at work, at home, and in the exam room. She saw the shift firsthand in her clinical practice.

Families that once agreed to imaging studies or specialist referrals without hesitation began asking whether the test was covered and what it would cost. That pattern, she says, spans the full income range.

Even among higher-earning families, the financial pressure is real. The households with the nicest cars are often under the same stress as households with far fewer resources, she says. They have simply scaled the problem up.

She describes the cascading expenses parents rarely anticipate before they arrive: the gap between what school systems cover and what children with developmental or educational needs actually require, the cost of travel sports, and the outlays that accumulate from pregnancy through the early school years. Lantern has measured this directly. A food insecurity program the organization piloted in Colorado found that 75 percent of participating families reported reduced food insecurity after receiving targeted text-message resources, and more than 85 percent said they discovered local programs they had not known existed.

The same pattern holds for financial planning, Richardson says. Families often lack access to basic information, not the willingness to use it.

The larger finding from her two decades of work is that family financial planning tends to address the scenario where everything goes as expected. The scenario where it does not tends to go unaddressed until it is no longer hypothetical.

The Policies She Made Sure Were Hers

What shaped Richardson’s financial thinking was not a seminar or a planning worksheet. It was growing up with a mother who had not planned, and then navigating her own divorce.

“I was brought up by a single mom who, when I was in high school, we had creditors calling our house all the time,” she says. “And so I know what it can look like to have someone who hasn’t planned.”

That history made her deliberate. She watched her mother trying to make retirement work on $36,000 a year in Social Security and a small supplement, and decided she would not arrive in the same position. She kept life insurance and disability coverage alongside her employer benefits, specifically because she understood that employer benefits require the employer.

“My biggest fear going through my divorce was, am I going to be able to do this financially on my own? I need to make sure that no matter what happens, whether it be divorce, illness, any of those things, that I have really thought and made sure that my daughter is going to be okay,” Richardson says.

The question she asked during her divorce is the same question a life insurance policy is designed to answer before the moment arrives. The answer depends entirely on what was put in place when everything was still intact.

Richardson maintained individual policies throughout her career at that health system, and she is direct about why.

“Some of my insurances definitely and always has been outside of my employer, because even if I’m not working at an employer that offers those benefits, I know that I still have those things,” she says.

After nearly sixteen years at that health system, she made the decision to leave. The individual coverage she had maintained was part of what made the transition possible. Planning outside her employer had given her the financial flexibility to walk away when the organization’s direction no longer aligned with her own.

After thirty years of advising physicians, dentists, and other high-income professionals at Set for Life Insurance in Greenwood Village, Colorado, what Richardson describes is one of the most consistent findings I see: an employer benefit is a workplace benefit, and it ends when the employment does. Among the executives I advise, the ones with the most options when their employment situation changes are the ones carrying executive disability coverage outside their group plan.

Individual life insurance and disability policies, issued in the policyholder’s name and not tied to any employment relationship, follow the insured regardless of where their career leads. Why even high-income professionals consistently underestimate how much of their future earning capacity goes unprotected is examined in a conversation with Michael Sir of One Protection, whose software makes the true size of the income gap visible in dollar terms.

What Richardson Tells Parents Now

Richardson is not an insurance professional. What she brings to this conversation is a physician’s and nonprofit leader’s perspective on how financial disruption actually lands on families, and firsthand experience navigating one.

Colorado recently joined a growing number of states requiring financial literacy education for every high school student, a development Richardson calls a meaningful starting point. She does not think it is sufficient on its own.

Most families, she says, lack the background to make consequential insurance and planning decisions without professional guidance, and she was no exception. She sought out advisors for investments and coverage precisely because she understood that wanting to make good decisions is not the same as having the knowledge to make them.

She observes one more pattern worth naming. Through Lantern’s work with families accessing food banks and community resources, Richardson has seen how much shame attaches to asking for help. She sees the same dynamic in insurance.

Families who have paid premiums for years sometimes hesitate to file a claim because the act of filing feels like an admission. Richardson says her answer to that hesitation is the same whether the resource is a food pantry or a disability policy: that is exactly what it is there for.

The families she works with through Lantern lose their financial footing for reasons most of them did not anticipate: a job loss, a health diagnosis, a family structure that changes without warning. What she observes consistently is that the families with the most flexibility when those moments arrive are the ones who built it before they needed it.

He was 41 years old litigator who just made partner at his firm. His career was on the ascent. Then, out of no where, he suffered a massive stroke.
A partner's earning power is the asset at risk. Disability insurance for attorneys is underwritten on health, and a stroke at 41 ends any chance to buy it on ordinary terms.

He survived. But the left side of his face was partially paralyzed, and his speech — the tool on which his entire legal career depended — was slow and hard to follow.

How clients defected. And plying his trade in the courtroom was no longer a realistic option.

“He spent all this time, energy and money going through law school, passing the bar, becoming a lawyer, becoming a partner at a young age — and boom, it was all taken away.”— Mike Cogdall, President, Income Protection Solutions

In this episode of the Income Protection Journal Podcast, Mike Cogdall who has has decades of experience on the carrier side of the disability insurance industry, talks about this attorney, who he at a golf course years after his career ending stroke. And while their conversation was brief, the detail Cogdall remembers is this. Since the attorney had an individual disability insurance policy with own occupation coverage, it was still paying him a monthly benefit that would continue until age 65.

The policy didn’t give him his career back. But it meant that a single neurological event, arriving without warning in the middle of a successful professional life, did not also become a financial catastrophe.

What Own Occupation for Lawyers Actually Means

For attorneys and other legal professionals, the definition of disability inside an insurance policy is much more than a technicality. It is what they’re buying

In the reality, disability isn’t binary. It isn’t about if you can work, or you can’t. Own occupation disability insurance asks something more precise:

Own occupation coverages determines whether you can perform the substantial material duties of your specific occupation. Not any occupation you might be capable of filling. The one you actually trained for and practice.

Cogdall describes the distinction this way: a litigating attorney earns income through oral argument, client relationships, and courtroom presence. Those are the material duties of that occupation.

The ability to research case law or review documents is not a substitute. Under a true own occupation disability insurance policy, a lawyer who can no longer perform those core functions has a legitimate disability claim — even if they are technically capable of doing other work.

“If you can’t do your profession, you’re covered,” Cogdall says. The attorney in his story could have retrained, moved into a transactional practice, or taken on work that didn’t require oral advocacy. Under own occupation terms, none of that extinguishes the claim.

Group Policies vs Individual Policies

Many attorneys carry disability coverage through their law firm’s group policy and assume that is sufficient. Cogdall is careful not to dismiss group disability insurance, but he draws a clear distinction between what a group policy is designed to do and what an individual disability insurance policy guarantees.

Group disability policies, he explains, are structured to return people to work as quickly as possible. The definitions of disability in those policies tend to be broader and less favorable to the claimant — in some cases requiring that a person be unable to perform any gainful occupation, not just their own. For a lawyer whose specific professional capacity has been compromised, that distinction can be the difference between a paid claim and a denied one.

An individual disability insurance policy, by contrast, is a guaranteed contract between the insurer and the policyholder alone. The terms don’t change at renewal. The carrier cannot reprice based on the claims experience of a larger group.

Because those policies follow the insured regardless of where their career leads, they provide flexibility that employer-based coverage cannot, as pediatrician Dr. Katie Richardson describes when explaining how maintaining individual disability coverage gave her the financial option to leave her employer of sixteen years. And the definition of disability — particularly under own occupation coverage — is fixed at the time the policy is issued.

The risks most attorneys don’t anticipate

Cogdall is direct about where disability claims in the legal profession actually come from. Most people picture an accident — a car crash, a sports injury, something sudden and visible.

The reality, he says, is that the majority of long-term disability claims stem from illness: cancer, neurological conditions, autoimmune disease, cardiovascular events. The kinds of diagnoses that arrive without obvious warning and can permanently alter a person’s professional capacity.

For lawyers, whose income depends on cognitive sharpness, communication, and the ability to perform under pressure, the implications of many common diagnoses are more severe than they might be in other professions. A condition that would allow someone in another field to continue working in a modified capacity may effectively end a litigation career.

There is also, Cogdall notes, the question of when to act. Disability insurance policies for attorneys and other professionals are underwritten at the time of application — not at the time of a claim.

The health history a person brings to an application is the one that determines their coverage terms. As lawyers move through their careers and approach the years when serious diagnoses become more common, that window for obtaining favorable coverage quietly closes.

What the fine print obscures

For attorneys evaluating income protection for attorneys, Cogdall’s central argument is that the policy definition — specifically the own occupation language — matters more than almost any other feature. Premium cost, benefit period, and waiting period are all meaningful variables, but they are secondary to understanding precisely what conditions will trigger a paid claim.

The gap between what a disability insurance policy appears to promise and what it delivers under real-world conditions is, in Cogdall’s experience, where most professionals are surprised. And in the legal profession, surprises in the fine print tend to arrive at the worst possible moment.

The broader conversation is worth hearing

The attorney’s story is one thread in a longer discussion about how disability insurance carriers evaluate occupational risk, why individual and group policies behave so differently when a claim is actually filed, and what legal professionals and other high-income earners consistently misunderstand about their coverage.

The full podcast covers considerably more ground — including how carriers think about professional risk, what happens when an initial underwriting offer comes back unfavorable, and why the market for individual disability coverage has contracted as sharply as it has over the past three decades. For any professional whose income depends on a specific, hard-won set of skills, it is a useful hour.

When people apply for insurance, they expect a straightforward process. Fill out an application, answer a few health questions, and wait for an approval. But in many cases, something else happens behind the scenes they never see coming.
That review is standard practice. Underwriters for disability income insurance read the medical file before they price a policy, which is why the timing of an application matters as much as its contents.

During a recent conversation on the Income Protection Journal Podcast, I spoke with Steve Eskoz about the moment many applicants realize the process is more complicated than they expected, when the insurance company asks for their medical records.

I’ve worked with Steve on thousands of insurance cases over the years, but most people outside our industry never see the part of the process he manages every day. Steve is a senior executive account manager at the Eugene Cohen Insurance Agency who has spent more than a decade navigating complex insurance cases involving life, disability, and long-term care coverage. His role involves coordinating the underwriting process that determine whether someone is approved for coverage and on what terms.

What he described during our conversation was something most people never anticipate.

Why an Attending Physician Statement Is Requested

One of the most common surprises occurs when the insurance company requests what is known as an attending physician statement, often shortened to APS. This is essentially a copy of your medical records from your doctor’s office.

As Steve explained during our conversation, the request itself is not unusual. In fact, he told me that it happens far more often than most applicants realize.

“Across all ages, I would say medical records are requested at least half the time,” Steve said. “In many cases it’s closer to sixty or sixty-five percent.”

That statistic alone tends to catch people off guard. Many applicants assume the insurance company relies entirely on the health information provided on the application. In reality, insurers often verify that information by reviewing records from physicians, hospitals, or diagnostic facilities.

This is where the timeline of an application can change dramatically.

When medical records are requested, the insurance company must wait for a physician’s office or hospital records department to release them. And those offices operate on their own schedules. According to Steve, most requests are fulfilled within a few weeks, but delays can happen.

In some cases the delay isn’t caused by the insurer at all. It may come down to something as simple as a physician working at multiple clinics or a records request being sent to the wrong facility. When that happens, the entire process can stall until someone tracks down the correct source of the records.

That investigative work is one of the parts of the process most applicants never see.

How a Medical Records Review Changes the Timeline

Even when records arrive quickly, they sometimes raise new questions.

During our discussion, Steve explained that an insurance underwriter might review a set of medical records and discover references to additional doctors or tests that were not originally included in the application.

For example, a physician’s note might mention that a patient was referred to another specialist for testing. If those results are not already included in the file, the insurer may request another set of records before making a final decision.

From the applicant’s perspective, it can feel like the process keeps expanding.

But from the insurer’s perspective, it is part of verifying the risk they are taking on.

Steve described underwriting in simple terms during the interview. Insurance companies group applicants into risk categories based on health history and other factors so they can estimate how likely claims are to occur. The better they understand that risk, the more accurately they can price coverage.

And sometimes the smallest detail in a medical file can change the way a case is evaluated.

Why Preparation Before Applying Can Matter

One of the most useful parts of our conversation was Steve’s explanation of how applicants can sometimes prepare for the process before they ever submit an application.

If someone knows their medical history is complicated, he often recommends what the industry calls pre-underwriting. Instead of immediately applying for a policy, a broker can anonymously present the key medical details to multiple insurers to see how each company might evaluate the case.

That approach can prevent unpleasant surprises.

It can also reveal something else many applicants do not realize. Different insurance companies evaluate the same health information differently.

Steve shared an example from a case we worked on together in which one company initially declined an applicant based on their medical history. After presenting the same information to several other insurers, three companies were willing to offer coverage at better terms. Armed with that information, we were able to return to the original carrier and negotiate a better outcome.

That kind of advocacy is rarely visible to the person applying for coverage.

But it is one of the reasons experienced brokers spend so much time working behind the scenes.

Why Timing Can Influence the Outcome

Another point that came up repeatedly during our conversation was timing. Many people assume the best time to apply for insurance is when they feel the need for coverage most urgently. In practice, the best time is usually earlier.

Health changes, new diagnoses, or even future medical testing can influence how a case is evaluated. Once new medical information appears in your records, it becomes part of the underwriting picture.

As Steve put it during the interview, the simplest strategy is often the best one.

“The sooner you apply while you’re healthy, the better,” he told me. What that policy actually delivers when a professional like a litigating attorney loses the ability to perform oral argument is examined in a conversation with Mike Cogdall, who spent decades on the carrier side of disability claims involving professionals whose income depends on a specific hard-won set of skills. “Your health is really what qualifies you for the policy.”

The premiums simply determine how much that protection costs.

For professionals who depend on their income or business stability, that distinction matters. A change in health history can affect approval timelines, pricing, or eligibility in ways that are difficult to reverse later.

That is why the underwriting process, and the possibility of an attending physician statement, plays such a critical role in how insurance decisions are ultimately made.

Our full conversation on The Income Protection Podcast explores the process in far more detail, including how records requests are handled, why some cases move quickly while others take months, and how experienced brokers sometimes help applicants secure coverage when a case initially appears impossible.

Listening to the conversation makes it clear how much work happens behind the curtain of an insurance application.

And why understanding that process ahead of time can make a significant difference.

Dentists spend years mastering precision, technique, and patient care. What they often underestimate early in their careers is how quickly a physical injury can interrupt that work and place an entire practice under pressure. During a recent episode of The Income Protection Podcast, I spoke with Dr. Eric D’Hondt about the moment he realized the physical demands of dentistry could suddenly threaten the stability of both his career and his practice.
The practice keeps running on someone else's hands. Disability insurance for dentists replaces the owner's income while an associate covers the chair, which is a separate question from who treats the patients.

Dr. D’Hondt is a partner at Greenwood Dental Associates in the Denver area and has practiced dentistry there for more than two decades. He also serves as an adjunct clinical professor at the University of Michigan School of Dentistry and sits on the board of the Dentist Professional Liability Trust of Colorado. Those roles have given him a long view of the profession and the risks that many dentists do not think seriously about until they experience them personally.

Dentistry is not simply intellectual work. It is highly physical work that depends on sustained posture, precise motor control, and repetitive hand movements that accumulate over thousands of procedures each year. For most dentists, those demands remain invisible until the body begins pushing back.

The Physical Risk Dentists Often Ignore Until It’s Personal

During our conversation, Dr. D’Hondt described how that realization crept into his own career.

“When you’re twenty something years old and in dental school, you never would think your body could give out from doing dentistry,” he told me. The profession feels manageable in your twenties, when stamina and flexibility seem endless. But somewhere in his early thirties he began noticing neck and back problems that hinted at how demanding dentistry can be over time.

That experience is not unusual in the dental profession. Dentists spend long hours leaning over patients while performing delicate procedures that require steady hand control and intense concentration. Small ergonomic compromises repeated day after day can slowly become chronic problems.

The consequences extend beyond discomfort. A dentist who cannot perform procedures cannot generate the production revenue that sustains a practice. When the dentist is also the owner, the stakes multiply.

Eventually Dr. D’Hondt developed severe arthritis in both thumbs, a condition tied directly to the repetitive motion involved in dentistry. At first the pain appeared gradually during everyday activities. Then it began affecting his work.

He remembers the moment when the situation became impossible to ignore.

“I remember sitting in my house thinking this is going to end with me dropping a handpiece in somebody’s mouth and my career is over.”

The thought forced him to confront a reality that many dentists rarely imagine while their careers are still moving forward normally.

Why Disability Insurance for Dentists Matters When Clinical Work Stops

When a dentist becomes unable to perform procedures, the financial impact is immediate. Patients still need treatment.

Staff still expect to work. The practice still has obligations.

Dr. D’Hondt eventually underwent surgery on both hands. During the first procedure he was temporarily unable to practice, which meant his patients had to be cared for by someone else. He brought in another dentist to help manage patient treatment during his absence.

That solution preserved patient continuity, but it also created an additional expense for the practice. The experience revealed something many dentists overlook when they think about disability risk.

Income is only one part of the equation. A dental practice is also a business with ongoing obligations.

Staff wages, facility costs, equipment payments, and utilities continue regardless of whether the owner is performing procedures. For dentists who own their practices, disability can threaten both personal income and business stability at the same time.

This is where disability insurance for dentists enters the conversation. The purpose of these policies is straightforward. They replace a portion of a dentist’s income if illness or injury prevents the dentist from performing the material and substantial duties of dentistry.

In Dr. D’Hondt’s case, personal disability coverage helped address income risk, while business overhead coverage helped stabilize the practice itself during his recovery.

The combination mattered because the practice still needed to operate even while he stepped away from clinical work.

What Younger Dentists Often Realize Too Late

The conversation also turned to a question many younger dentists face early in their careers. When should they begin thinking about disability insurance?

Dr. D’Hondt obtained his first disability coverage shortly after completing his residency training. At that stage he had no serious health issues and little reason to expect problems in the future.

But that timing turned out to matter.

Years later, when arthritis appeared in his thumbs and degeneration in his spine became visible on imaging, those conditions would likely have complicated the process of obtaining new coverage. Medical underwriting often evaluates an applicant’s health history before issuing a disability insurance policy, a process that includes requesting medical records directly from physicians in roughly half of all applications, as Steve Eskoz of the Eugene Cohen Insurance Agency explains in a separate episode.

Because he secured coverage earlier, those conditions were not exclusions in his policy. A trauma surgeon describes a parallel experience, when a torn hand ligament from an off-duty task threatened weeks of surgical income and forced a realization about what it means to rely entirely on hands.

Looking back, he sees that decision differently now.

“If I had waited until after those problems started showing up,” he told me, “my thumbs and my back probably would have been excluded.”

That observation reflects a broader reality in dentistry. Many dentists focus heavily on building their practices, repaying dental school debt, and growing their patient base. Insurance planning often receives attention only after a health issue raises new questions.

By then the options available may already be more limited.

The Conversation Behind the Article

The episode explores these issues in more detail than an article can capture. Hearing Dr. D’Hondt describe the moment he realized surgery was unavoidable adds a level of context that written words rarely convey.

The pauses in his answers, the way he reflects on the uncertainty of that period, and the practical decisions he had to make about his practice all become clearer when you hear the conversation directly.

Dentists rarely imagine the day they might need someone else to treat their patients. But as this conversation shows, the physical demands of dentistry make that possibility more real than many practitioners expect. The financial mechanics of that scenario, overhead still due, staff still paid, patients still needing care, are what disability insurance for dentists who own practices is specifically designed to address.

Listening to how Dr. D’Hondt describes that turning point makes the risk feel much less theoretical.

When Steven Crawford told me about the hospitals on probation, he actually got a little choked up. He was trying to choose his words carefully because what he was about to say has real consequences for thousands of medical residents and fellows who assumed the offer sitting in their inbox would still be valid when they clicked on it after Match Day.

Program instability changes the calculus for a resident. GSI disability insurance is underwritten on training status, so a program's accreditation trouble can affect the window to buy.

Early last year, Guardian Life Insurance pulled guaranteed standard issue programs from 3 teaching hospitals, according to Crawford, with zero advance notice and no grace period.

Residents who had been planning to enroll before graduation discovered that the offer (the one that would have let them secure disability insurance before graduation with no medical questions, no exclusions, and permanent discounts of up 30%) was gone forever.

This is the part of the GSI conversation that rarely gets discussed. In Part 1 of this series, "Securing GSI Disability Insurance with No Medical Questions Asked," I spoke with Steven Crawford about how residents accidentally void their GSI eligibility by inadvertently applying through an unapproved GSI provider first. That mistake is devastating, and it happens constantly.

But the risk I wanted to explore in this second conversation is different. It's the risk of doing nothing wrong, and still losing access because the program got cancelled while you waited.

Steven Crawford, President of Financial Balance Group, has spent decades setting up and managing GSI disability insurance programs with Guardian. He has built nearly 200 Guardian GSI hospital programs nationwide. When he says the landscape is fluid, that's because participation rates at individual hospitals determine whether those programs survive.

The Participation Problem Nobody Warned You About

I wanted to understand the mechanics of that instability, and what it means for any resident or fellow who is currently between Match Day and graduation, sitting on an offer they haven't acted on yet. What we discussed on The Income Protection Journal Podcast was more unsettling than I expected, not because of what residents don't know, but because no one can anticipate when an offer might get pulled.

Guardian requires roughly 40% participation at each hospital to sustain a GSI offer. In the podcast, Steven Crawford shared that last year, the company issued approximately 9,700 policies to residents and fellows across its hospital partnerships, representing about 39.7 percent of the eligible population. That is right at the threshold. And while the number of Guardian Life Insurance Company GSI disability offers has grown to nearly 200 programs nationwide, one major competitor dropped 20 to 25 programs in the last 2 years. Another carrier is down to less than 15.

The reason programs get pulled is straightforward. When not enough residents enroll, the insurance company absorbs disproportionate adverse risk from the smaller pool that does. The economics stop working.

So the company withdraws the offer—sometimes mid-year, without waiting for a calendar reset. Steven described hospitals where Guardian's GSI programs were placed on what amounted to probation in 2025, where producers had to argue against having the offers revoked entirely.

For any resident thinking they can safely wait until May or June, this is the calculation that should change their mind. The offer is not guaranteed to exist until graduation.

It's guaranteed to exist right now. Those are two very different things.

What makes this especially painful is the cost of acting. Steven walked me through the numbers for a first-year resident: a base policy of $2,500 per month with a benefit purchase rider, using graded premiums, runs between thirty and forty dollars a month.

That rider allows future increases up to $15,000 per month without additional medical underwriting. In exchange for what amounts to a modest monthly expense, a resident locks in a non-cancellable, portable individual disability insurance policy—own occupation, with Guardian's surgical specialty language—that follows them through every career transition for the rest of their working life.

The group long-term disability coverage that hospitals provide during training, which Steven acknowledged can be excellent at some teaching institutions, disappears the day you graduate. Every resident knows they need individual coverage eventually. The question is whether they secure it while the GSI window is open or gamble that the window stays open long enough for them to get around to it.

*Steven Crawford explains why GSI disability insurance timing around graduation is more precarious than most residents realize.*

Match Day and the 90-Day Clock

The timing rules around graduation are more precise than most residents expect, and in the episode, Steven's specificity on this point was striking. Guardian allows enrollment during training and for ninety days after graduation, but only at a hospital where a GSI offer is actively in place.

Ninety days does not mean the end of the third calendar month. It means exactly ninety days.

If you graduate on June 30, your window closes around September 27, not September 30. Miss it by a day and there are no exceptions.

Steven also described a strategic opportunity around Match Day that most residents never hear about. If a medical student or resident matches to a hospital with an active Guardian GSI program, they can apply before they physically start training. They submit the application using their current address and request an effective date of their first day at the new institution.

The policy cannot be issued until they are employed, but the application secures their place. For residents transitioning from a program without GSI to one with it, this is the one moment to act.

The inverse scenario is equally important. A resident currently training at a hospital with GSI who matches to a fellowship program without it has a shrinking window to enroll before they lose access entirely. Steven's advice was unequivocal: take care of it while you have the opportunity, because once it's gone, it's gone forever.

What I found most revealing in our conversation was Steven's candor about the industry itself. He described online platforms where physicians seek disability insurance advice and where some of the people involved knowingly recommend carriers that don't offer GSI, even when they know the resident's hospital has a guaranteed standard issue program available. He called it morally reprehensible.

In the recording, you can hear the shift in his voice when he says it. That moment lands differently when you hear it than when you read it on a page.

According to Milliman, roughly half of people who believe they're healthy receive some form of modification—an exclusion, a rating, a limitation—when they apply for disability insurance through full medical underwriting.

For a surgeon, an exclusion on hands or elbows isn't an inconvenience. It's a gap in coverage precisely where the risk is highest. GSI eliminates that entirely, the study says.

Standard rates. No exclusions.

No possibility of being declined. And for residents with conditions ranging from ADHD medication to pregnancy complications to prior injuries, it is their only realistic path to comprehensive individual coverage.

Steven emphasized a point that bears repeating: the GSI policy from Guardian is the same contract as the fully underwritten version, with only three differences.

The age-seventy benefit period option is not available on GSI.

The serious illness supplement is not available.

Mental nervous coverage is limited to two years for all specialties, whereas some specialties can receive unlimited mental nervous protection through full underwriting.

Otherwise, the contract language, the own occupation definition, the surgical specialty provision, and the premium structure are identical, Steven Crawford says.

The difference is not in what the policy covers. The difference is in who can buy one. How that same coverage window plays out in dentistry is examined in a conversation with Dr. Eric D’Hondt, a dental practice owner who secured a policy before daily procedures created the thumb arthritis that would have excluded his hands under full underwriting.

I asked Steven what he would tell a resident who has ten minutes and just needs to know what to do. His answer was surprisingly simple: Google your hospital name and "GSI disability insurance," find a producer who actually has access to the program, fill out the three-page pre-application, and in most cases, the policy can be issued within forty-eight hours. During peak graduation season it might take a week.

The process, he said, is so much easier than residents think it is. And once it's done, they never have to think about those hundreds of emails from insurance agents again.

But only if the program still exists when they finally decide to act.