Disability insurance protects your income if you’re unable to work due to illness or injury. Two key policy types are own-occupation and any-occupation. Understanding the difference is crucial for choosing the right coverage.
Own-Occupation Disability Insurance
This type pays benefits if you’re unable to perform the main duties of your specific occupation.
Key Features:
Pays benefits even if you can work in a different occupation
Ideal for specialized professionals (e.g., surgeons, dentists)
Generally more expensive
Offers more comprehensive coverage
Example:
A surgeon with hand tremors may receive benefits even if they can teach or consult.
Any-Occupation Disability Insurance
This policy pays benefits only if you’re unable to work in any occupation suitable for your education, training, or experience.
Key Features:
More restrictive definition of disability
Lower premiums compared to own-occupation policies
May be sufficient for those with transferable skills
Example:
An office worker with a back injury may not receive benefits if they can perform any desk job.
Choosing the Right Policy
Consider:
Your occupation and specialization
Income level and financial obligations
Budget for premiums
Long-term career plans
Professionals with highly specialized skills often benefit from own-occupation policies, while those with more general skills might find any-occupation policies sufficient.