March 29, 2022

Physician's Edition: What is a Catastrophic Rider aka CAT Coverage?

3 minutes

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In this episode, Scott and I discuss the Catastrophic Rider that can be added to an Own Occupation Disability Insurance plan.

Catastrophic events occur if you are on a disability insurance claim but also have 2 of 6 activities of daily living that you cannot perform. This then triggers the additional insurance benefit on top of the base benefit.

This is the high-level definition and each insurance carrier has specific contract provisions, specific to that carrier and not every state offers this rider. Although the CAT provisions can be a little different between each carrier but overall; the ADLs are what trigger the additional coverage.

This one feature isn't as expensive as COLA and we have a mix of clients that purchase it. Often, with the ADL loss; many can get better before their elimination period is up so some question the value. It is certainly a personal choice and I have one of these on my disability insurance contract.

Please tune in as this episode should help you to determine if you want a CAT rider or would like to remove one off of your contract.

Thanks for listening!

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