ataloss wrote:The only scare tactic that they are referring to is the inflating of the statistics. Notice that in this entire thread, no statistics are used.
True enough, this thread has scary stories w/o statistics. It looks like the odds of becoming disabled are low.
I thought it was interesting that the article mentions that physicians buy a lot of disability insurance but tend to file more claims.
The more likely that one is to file a claim, the more expensive that their policy will be. That is why physicians are more expensive than attorneys and women are more expensive than men.
I have a strong dislike for the use of statistics when it comes to insurance decisions on the part of an individual. Insurance is based upon the law of large numbers. It is critical for an insurance company to know that if they have 1000 people of your age in your profession what sort of claims that they will have. They need to know whether this will translate into 5 claims or 50 claims or 100 claims or 300 claims and whether the average claim will cost them $100, $1,000, $10,000, or $100,000.
However, an individual isn't a large number. The individual will either become disabled or they won't. Let's assume that the odds of you becoming disabled are rather low. That's probably an accurate assessment. Even if the odds are low, disability isn't some crazy event that we know will never happen to us. If that was the case, you wouldn't have purchased your association policy.
It just seems to me that if one is concerned that they might become disabled, it makes sense to get a policy that will cover them if they do.
As a guess, your association policy probably costs 1/4 of what a good individual policy will cost. This is because the contract is written so that they'll only pay out 1/4th of the claims that a strongly written contract will pay.
Another good analogy for association/group policies in comparison to individual policies is with life insurance comparing accidental death policies to regular policies.
"I know that if I become disabled I will become disabled in a way that will allow me to collect the full benefit on my Association plan." I know that if I die prematurely, it will be by accident."
With insurance, one should know that they'll be ok if something happens. Group/Association plans don't do this for disability. Accidental death policies don't do this for death.
I'm not saying, Ataloss, that you need individual coverage. I am saying that if you do need coverage it may make sense to pay for a stronger policy.