Is a 90-Day Waiting Period Always Best for Physician Disability Insurance?
When I work with a resident or younger physician purchasing individual disability insurance, I will often start by looking at a 90-day waiting period. For someone who has not accumulated significant savings yet, receiving disability benefits sooner could be very important. However, that does not mean every physician should automatically choose 90 days.
- Is a 90-day waiting period always the best choice for physician disability insurance?
No. A 90-day waiting period is often appropriate for residents and younger physicians, but established physicians with substantial liquid savings may want to compare the cost and risk of a 180-day waiting period. - Why would a physician choose a 180-day waiting period?
A longer waiting period may reduce the disability insurance premium while allowing a physician with adequate savings to self-insure the first several months of a disability. - What matters most when choosing a disability insurance waiting period?
Consider your emergency savings, monthly disability benefit, premium difference, ability to cover expenses without benefits, and the long-term financial risk you are trying to protect.
As physicians move further into their careers and accumulate savings, investments, and emergency reserves, the conversation can change. The real question becomes: How much short-term risk can you comfortably handle yourself, and how much long-term risk do you need the insurance company to take?
What Is a Disability Insurance Waiting Period?
A disability insurance waiting period, also called an elimination period, is the amount of time you generally must satisfy before disability benefits become payable under the policy, subject to its terms.
A 90-day waiting period means you are accepting more of the initial financial risk than with a shorter waiting period. Moving from 90 days to 180 days shifts even more of that short-term risk to you, but it may also reduce the cost of your physician disability insurance policy.
Should Physicians Choose a 90-Day or 180-Day Waiting Period?
Consider an attending physician evaluating $10,000 per month of disability insurance coverage. In one case, the 90-day waiting period cost $688 per month, while the 180-day option cost $523 per month. That is a difference of $165 per month, or almost $2,000 per year.
Before deciding which option is better, I want to know how much money that physician has available in savings.
If you have $15,000 in the bank, I may recommend keeping the 90-day waiting period because those disability checks could become very important. If you are an established attending physician with $500,000 or more in liquid savings and a fully funded emergency fund, we should probably have a different conversation.
How Much Risk Are You Taking With a 180-Day Waiting Period?
With a $10,000 monthly benefit, moving from a 90-day to a 180-day waiting period means accepting approximately $30,000 of additional risk yourself. Those are three months of potential disability benefits you may not receive.
At the same time, if you are saving approximately $2,000 per year in premiums, that adds up to roughly $30,000 over 15 years.
If you can comfortably absorb that initial $30,000 loss yourself, it is reasonable to ask whether paying additional premiums to transfer that particular piece of risk to the insurance company makes sense for your financial situation.
What Financial Risk Should Physician Disability Insurance Really Protect?
When I think about disability insurance for physicians, I am much less concerned about a physician being unable to work for four or five months than I am about a physician losing the ability to practice their medical specialty for 10 or 20 years.
For a 42-year-old physician who can no longer practice their specialty, the potential loss of future income could reach millions of dollars. That is the catastrophic financial risk I want the disability insurance policy designed to protect.
Should You Extend the Waiting Period to Lower Your Disability Insurance Premium?
For the right physician, I would rather explore a 180-day elimination period than immediately reduce the monthly disability benefit or give up an important contractual provision such as a True Own Specialty disability definition.
Conceptually, you are saying, “I can handle the first six months. I want the insurance company protecting me against the possibility that this disability lasts for years.”
For a physician with adequate liquid savings, that can be a very different risk management strategy than simply shopping for the lowest disability insurance premium.
From Scott & Amber’s Desk
There is no single disability insurance waiting period that is right for every physician. A resident, fellow, or early-career physician with limited savings may have a strong reason to maintain a 90-day waiting period, while an established attending with significant liquid assets may want to seriously evaluate a 180-day option.
The goal is not simply to buy more insurance or pay the lowest premium. It is to identify the financial loss that could truly hurt you and use physician disability insurance to transfer the risks you cannot comfortably absorb yourself.
Every article in the MD Disability Quotes Knowledge Center is written with one purpose: to help physicians understand insurance contracts before they ever need to rely on them.
To take the next step and build a strategy that supports your career and financial future, download the FREE Medical Professionals Blueprint here.
About MD Disability Quotes
MD Disability Quotes is a nationwide disability insurance advisory firm specializing in income protection for physicians, dentists, business owners, and other high-income professionals.
Founded by Scott Nelson-Archer and Amber Stitt, the firm brings more than 45 years of combined experience helping clients evaluate disability insurance contracts, navigate underwriting, and design income protection strategies tailored to specialized careers.
Scott and Amber are the longest-tenured disability insurance experts featured by White Coat Investor. Their education-first approach has helped thousands of physicians better understand disability insurance throughout medical school, residency, fellowship, and practice.
Whether you’re reviewing an existing policy or exploring coverage for the first time, MD Disability Quotes is committed to helping you make informed decisions that protect your ability to earn an income.
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