The Catastrophic Rider of a physician disability insurance policy is frequently misunderstood, or misrepresented. While it does provide additional benefit dollars, there are also additional restrictions one must meet in order to qualify for the added benefit.
Essentially, there are ‘6 Activities of Daily Living’ to consider:
If you are unable to perform 2 of these without assistance you will qualify for the additional benefit.
It is important to think of this as an entirely separate benefit than your disability insurance benefit. For instance, if you have 15k in disability insurance and 10k in Catastrophic, you do NOT have a 25k policy. In reality, the “disability insurance” portion is designed to replace your income, while the “catastrophic” portion is designed to cover all expenses related to your “Activities of Daily Living.”
We always emphasize this point as several physicians have come to us thinking they have purchased a much higher benefit than they realize.