What is an 'Any-Occupation Policy'

An any-occupation policy is a type of disability insurance which categorizes the kind of work for coverage purposes. Any-occupations coverage provides for when the insured is unable to work in a job that is reasonably suitable for them based on their education, experience, and age. 

An any-occupation policy terminology, as used in disability insurance policies, identify the conditions under which a policyholder receives benefits. 

BREAKING DOWN 'Any-Occupation Policy'

The any-occupation terms in policy specify the type or nature of work that a policyholder is able to perform. If they are capable of still working, even if it is at a lower-paying job, an any-occupation policy would not pay benefits. In contrast, the own-occupation policy is one that would consider the policyholder disabled if they are unable to perform the same job as they did before an accident or injury.

For example, under an any-occupation policy, a surgeon who injured their hands would not receive benefits if they could still work as a doctor in the medical field, but not as a surgeon. Under the own-occupation, they would continue to receive benefits until they could return to practicing surgery again. However, if their disability prevents the policyholder from performing any-occupation for which they are reasonably qualified, they would qualify for benefits. Returning to the example of the surgeon, if they could not function in a hospital setting without specialized equipment or assistance the benefits will continue.

Employer-provided disability insurance may only be available as an any-occupation policy. Employees may purchase a supplemental disability policy for additional protection.

Own-occupation coverage is for the insured’s specific occupation with no other stipulations. If they are unable to perform the material and substantial duties of their pre-injury occupation, the benefit is paid, regardless of whether they choose to work elsewhere. For example, if the pre-disability surgeon found a new profession as a marketing director for a software company, they would still receive the full benefit. If the insured meets the definition of totally disabled and becomes employed in a new occupation, their total disability benefit will not be affected or lessened by any income from the new profession, regardless of the amount.

Additional Any-Occupation and Own-Occupation Hybrid Policies

Transitional own-occupation coverage is own-occupation with an adjusted benefit. If the insured chooses to work in any other occupation, the earnings from the new profession might reduce the benefit amount. If the surgeon's full benefit amount was $8,000 each month and their new marketing position paid $6,000, the benefit could decrease to $2,000.

Some insurers offer a bonus-hybrid version of disability insurance. At the beginning of receiving benefits, the own-occupation definition guides payments. After a defined period of months or years, the coverages changes to a stricter definition of occupation. For example, it may only continue to pay the benefit if the insured remains unable to work at a profession for which they are qualified and does not work at any other occupation.

  1. Own-Occupation Policy

    An own-occupation policy covers individuals who become disabled ...
  2. Residual Benefit

    Residual benefit is provided by a disability insurance that provides ...
  3. Concurrent Periods

    Concurrent periods refers to specific points in time in which ...
  4. Business Continuation Insurance

    Business continuation insurance helps companies minimize the ...
  5. Noncancellable Insurance Policy

    A noncancellable insurance policy can't be cancelled by an insurance ...
  6. Classified Insurance

    Classified Insurance is coverage provided to a policyholder that ...
Related Articles
  1. Financial Advisor

    Disability and Business Overhead Coverage for the Self-Employed

    What every small business owner or professional needs to know about individual and business overhead disability income insurance plans.
  2. Insurance

    Insurance Do's and Don'ts for Young Doctors

    These are the insurance do's and don'ts for young medical professionals.
  3. Insurance

    5 Things You Need to Know About Disability Insurance

    It's important to understand the true value of your ability to earn income, and to make sure it's protected.
  4. Insurance

    Why Your Company Insurance Coverage Isn’t Enough

    Even if you have group life or disability insurance, it pays to have individual coverage too.
  5. Insurance

    4 Types Of Insurance Everyone Needs

    Here are four forms of insurance that are vital to have.
  6. Retirement

    Strategies to use life insurance for retirement

    Here's how to incorporate life insurance into a plan to ensure that you and your family have the smoothest possible transition into retirement.
  7. Personal Finance

    Why Having an Emergency Fund Is Essential

    Do you know how you’d pay the bills if you lost your job, had a health crisis or needed a major car repair? That's why an emergency fund is essential.
  8. Retirement

    Social Security Disability Benefits vs. Retirement Benefits

    Here's how to know if you should file for Social Security retirement vs. disability benefits.
  9. Insurance

    Is Loan Protection Insurance Right For You?

    Loan protection insurance can keep you from defaulting on your loans when you're in financial trouble, but it's not for everyone. Learn more on how it can help you.
  10. Retirement

    Social Security: More Than Retirement Benefits

    Social Security offers a lot more than just retirement benefits.
  1. Is there a limit on the amount of disability insurance that I can buy?

    Disability insurance policies are designed to partially replace your income in the event that you become disabled and cannot ... Read Answer >>
  2. What are the maximum Social Security disability benefits?

    The average Social Security disability benefit amount for a recipient of SSDI in 2018 is $1,197 per month, but a beneficiary ... Read Answer >>
Trading Center