Own-Occupation for 24 Months: A Dentist's Return to Work

Elimination period and full benefits:

• He became totally disabled in February under the own-occupation definition: he cannot perform the precise duties of an endodontist.
• The 90-day elimination period is satisfied by early May (day 91), so benefits begin then. Confirm whether the contract counts calendar days or days of disability; a calendar-day elimination period runs straight through, while a days-of-disability period can be interrupted by a failed return to work.
• From the end of the elimination period through the end of October (when he was still totally disabled and earning nothing), the policy pays the full $9,000 a month.
• Do not reduce the benefit for the group plan. An individual policy with no 'other income' offset rider does not coordinate with group disability benefits; only a rider or provision that specifically says so does that. Total income during the overlap (about $10,000) is far below his prior $22,000, so indemnity concerns do not arise.

Judgment point: the own-occupation definition, not the severity of the injury, is what triggers the full benefit. That is why specialty-specific own-occ coverage costs what it does.

Relationship-of-earnings calculation:

• Prior income: $22,000/month. Current income: $9,000/month.
• Income loss: ($22,000 − $9,000) ÷ $22,000 = 59% loss.
• Residual benefit: 59% × $9,000 = about $5,310 per month.
• Total monthly income: $9,000 earned + $5,310 benefit = $14,310, comfortably below his pre-disability $22,000, so the benefit is not capped by indemnity principles.

Points to verify in the contract:

• The 20% minimum-loss threshold is met, so the rider engages.
• Some riders compute residual as a percentage of the benefit rather than of income; the numbers differ, so read the formula.
• Residual provisions often require proof of earnings, use a look-back period to establish prior income (a bad year can lower the base), and may require a minimum number of work hours to count as 'working.'
• The monthly benefit continues only while the loss continues; a good month does not necessarily reset anything, but a sustained recovery does.

Judgment point: a client who returns part-time is not 'back to normal.' The producer's job is to file the residual claim promptly with earnings documentation rather than waiting for a total-disability claim that will never come.

The 24-month own-occupation window has closed. The clock runs from the start of disability, not from policy issue, so after 24 months the any-occupation test governs: is he able to perform the duties of any occupation for which he is reasonably fitted by education, training, or experience?

• Teaching clinical dentistry is squarely within that range. If he takes the job, he is not totally disabled, so the total disability benefit stops.
• The residual rider can still pay: income loss is ($22,000 − $6,000) ÷ $22,000 = 73%, so the residual benefit would be roughly 73% × $9,000 ≈ $6,540 a month, subject to the contract's formula and any earnings test.
• If he declines the position and stays home, the insurer will argue he is no longer disabled under the any-occ definition and terminate benefits. Most policies require that the occupation be one he could actually perform and reasonably obtain; a claim file with no vocational evidence is weak.
• A rehabilitation or return-to-work benefit, if present, may help pay for retraining and can preserve benefits during the transition.

Judgment point: the client's specialty is protected for only two years. Advise him at claim time - not at month 25 - that the definition will change, so he can plan a transition rather than be surprised by a termination letter.