Whether you are considering disability insurance, bought a policy on someone else’s recommendation, or are just getting tired of writing the check every year—it is essential to understand why disability income insurance matters.
If you’re like most people, you can agree that insurance is vital in protecting your most valuable assets. But what are your most valuable assets? Your car? Your home? Your business?
You have insurance on all of these, but where do these assets come from in the first place? The answer is, of course, your income. It’s sometimes difficult to remember, but you will earn millions of dollars over your career. Nothing compares in value to your ability to get up and go to work; it is the foundation from which all of your assets are able to accumulate. This is the reason disability income insurance is so vital to a comprehensive business and financial plan—it protects your most valuable asset.
If you still find yourself uncertain know this; in a study done by Harvard on the reasons behind home foreclosures, half of all respondent reported medical problems as a cause. This includes 27% reporting lost work from medical problems, and 14% reporting caring for a sick family member.1
It is becoming increasingly important as well; as modern medicine lowers fatality rates it also incidentally raises disability rates.2 Today’s 20-year-olds have a 1 in 4 chance of becoming disabled at some point in their life.3 This, compounded by the fact that premiums are tied to age, and that you can “price lock” policies, make putting off disability insurance inadvisable.
We’ve established how disability income insurance can protect you, but what about your business? A small business owner understands more than anyone how much goes into owning and running a business. How would your business be affected if you or another doctor in your office wasn’t able to work? If you’re going to work in private practice, a business overhead expense or key employee policy can help protect against these risks.
Before you start looking for a policy, make sure you know what features to look for to get income protection you can count on. If you already have one, it is essential to review it periodically—especially after major life events—in order to ensure that it is still aligned with your current financial goals.
You have made a major investment of both time and money into yourself in order to make a living doing what you love. Professional Insurance Programs would be honored to help you protect that.
1 Christopher Tarver Robertson, Richard Egelhof, and Michael Hoke, Get Sick, Get Out: The Medical Causes for Home Mortgage Foreclosures, 18 Health Matrix 65 (2008)
2 Fujiura, Glenn T. “Emerging Trends in Disability.” Population Reference Bureau, 1 Sept. 2001, www.prb.org/emergingtrendsindisability/
3 Social Security Administration, Disability and Death Probability Tables for Insured Workers Born in 1997, Table A.