What Does Own Occupation Mean?
Own occupation is a type of total disability insurance that provides a benefit for the insured if they are no longer able to work the job they were qualified and hired to do. Terms of coverage may depend on the insurance purchased.
Insuranceopedia Explains Own Occupation
There are three kinds of own occupation policies.
- True own occupation – Pays the benefit in full, even if the insured gets another job after incurring the disability.
- Transitional own occupation – Pays the benefits if the insured finds work after the disability, but just fills the gap between the total benefit and the post-disability salary. For instance, if the maximum benefit is $6,000 and the salary after disability is $4,000, the insurer will provide $2,000 to the insured.
- Own occupation, not engaged – Pays the benefit to the insured only if they are not working after the onset of the disability. If they find a job, the insurer will not pay the benefit.