The most valuable asset a physician has is their ability to practice.
The most valuable asset a physician has is their ability to practice and earn a significant income in their specialty. Physicians can make millions of dollars during their career, and this income is often relied upon to save for important goals like retirement, funding their children’s college educations, and purchasing a new home. What would happen if a physician became sick or disabled and were unable to continue practicing? Without disability insurance, many of that physician’s life goals may need to be sacrificed. Disability insurance can be a significant expense, but it can also ensure many goals are still achieved.
Disability insurance typically covers up to 60-70% of a physician’s pre-disability income. If a physician were to suffer a long-term disability, the policy will pay out a monthly benefit amount. These funds can be used to pay for necessary expenses and save for important financial goals. Here are a few key terms to pay attention to when shopping for a disability insurance policy or reviewing an employer provided plan.
If a physician needs disability coverage, they should consider getting that coverage as soon as possible. The premiums are lower the younger you are when you get a policy. There is also less likely to be red flags in your medical history which could lead to not being approved for a policy. Additionally, if you are a medical resident or fellow, many insurance companies offer discounts as high as 20% if you get a policy while still in training.
Most people don’t enjoy paying for insurance and some don’t see the importance of having coverage. However, disability insurance protects your most valuable asset---your ability to practice and earn income in your specialty field. It can be the difference between accomplishing all or most of your goals or accomplishing none of them.
Jeff Witz, CFP® welcomes readers’ questions. He can be reached at 800-883-8555 or at firstname.lastname@example.org.
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