Being a dental professional may be a rewarding and fulfilling career path for many, but it may include certain risks. For example, if you’re unable to practice due to an injury or illness, you may no longer be earning an income.
Disability income insurance is one option for mitigating that risk. These types of policies are intended to supplement a portion of that lost caused by a covered disability by providing monthly disability income payments to help cover your monthly expenses.
Learn how the process of using disability income insurance works, step by step.
When an Illness or Injury Stops You from Working
As soon as an injury or illness prevents you from working in a full-time capacity, consider contacting your insurance agent or company. They may help you to file for disability income insurance benefits and advise you on the required information for filing or advise you on how to proceed in some other way.
It’s important that you fully understand your policy before this point, when you need to activate benefits, to ensure you have the right coverage when you may still be able to adjust or add to your policy. Your agent should be able to facilitate filing a disability claim with the insurance company.
When Benefits May Begin
Disability income insurance policies typically include an elimination or waiting period. This is a predetermined amount of time the insured must be disabled before they may begin collecting benefits. Contact your insurance company for help determining if you are eligible for benefits, how to file a claim, when you may begin receiving benefits and what amount they’ll be in.
As You Collect Benefits
Typically, disability income insurance benefits are paid monthly. Unlike business overhead expense insurance, which may reimburse you for ongoing practice expenses, these benefits may be used for personal expenses such as a mortgage, groceries, monthly bills, etc. Including a cost-of-living adjustment rider in your policy may provide you with annual benefit increases if your disability lasts longer than one year, to help keep benefits consistent with inflation.
When You Can’t Return to Your Practice
Your disability income insurance policy will likely include a "maximum benefit period", or predetermined amount of time you’ll be eligible to receive benefits. Instead of being a specific number of years or months, a maximum benefit period is typically to age 65, 67 or 70.
When your injury or illness affects your ability to practice dentistry, but you may be able to work in a different job, an Own Occupation Definition may quickly become an important factor in your disability income insurance policy. This definition of disability may cover those disabilities that prevent you from working in the specific occupation you’ve been trained for and currently work in. Essentially, policies that include this definition may mean you won’t have to return to work until you can physically go back to practicing dentistry.
Practicing Part Time
If your policy includes partial or residual disability coverage, you may be able to return to practicing part time, or for a reduced number of hours, while still receiving disability income insurance benefits.
Partial disability benefits are typically paid in proportion to income loss. Between the minimum income loss required by the contract and a 75% income loss, the contract will typically pay that percentage of the total disability benefit. If the income loss is over 75%, many contracts will pay the full monthly benefit.
Each company's partial disability definition may differ, and you should refer to your contract's definition, but here is an example of how the partial disability benefit may work:
Pre partial disability income: $10,000/month
Post-partial disability income: $5000
Benefit payment= 50% of total disability benefit
Post-partial disability income: $4000
Benefit payment= 60% of total disability benefit
Post-partial disability income: $2500
Benefit payment= 100% of total disability benefit
Returning to Your Practice Full Time
As you recover from the injury or illness that stopped you from practicing, keep your insurance provider or advisor informed of your plan to return to work. They may help you to determine the last day of benefits, when you’ll receive your last benefit payment and the amount you can expect. Some policies include a "return to work" benefit to help as you transition back into practice. ie. you are no longer disabled but your income is.
The Most Important Step
Above everything else, the most important part of safeguarding your income in the event of a disability may not only be getting disability income insurance, but making sure you have the right coverage. Work with an advisor you can trust, who understands your industry, to customize a policy you can count on when you need it most.
About Treloar & Heisel
Treloar & Heisel is a premier financial services provider to dental and medical professionals across the country. We assist thousands of clients from residency to practice and through retirement with a comprehensive suite of financial services, custom-tailored advice, and a strong national network focused on delivering the highest level of service.
Treloar & Heisel and Treloar & Heisel Risk Management are divisions of Treloar & Heisel, LLC.
All policy definitions and examples are meant for general illustrative purposes only. Please refer to the terms of your insurance contract for the governing definitions.
Insurance products offered through Treloar & Heisel, LLC.