What’s next?

Now that you have completed medical school and are heading into your residency program your mind must be racing. The questions are in the hundreds but the most pressing are things like; where am i going to live? how am I going to get my belongings there? what is my schedule going to be like? what kind of insurance do I need? The list goes on, but one thing is for sure as you move into the final training stages for your chosen career, the reality of real life decisions becomes more focused and choices need to be made so that the transition from
learning to be a physician to actually being one is smooth.

I’d like to break it down for you. The most pressing decisions right now are finding a place to live that is affordable, flexible and in a location that suits your needs. Should you rent or buy? Renting is a great option because it is usually affordable it offers flexibility. This is important because it allows you to investigate the places that you may want to practice and settle down in. Buying a home is an investment that could strap you to a location if you decide you want to practice elsewhere. Transporting your personal items can be expensive depending on how far and whether you do it yourself or hire a private company. Obviously, the best option is doing it yourself but if that is not possible and your finances do not allow for private services, check with your local banking institutions and see if they offer small short term loans for this type of expense. Hopefully, you have already considered the need for Income Protection Insurance i.e. Disability Insurance. If not, I would strongly urge you to invest in this most important protection now. Why? because you are young, healthy and its cheap! In fact it will never be cheaper than this, and once you buy it the rates don’t change. You know as a medical professional the risk of health issues arise as we get older but you also know anything can happen at anytime to anyone, including you. That said make sure you work with experienced, knowledgeable professionals. I would recommend and independent advisor, as they work for you not a particular company.

written by:

Stacia Musleh

VP Incomeprotectionspecialist.com

The Importance of Income Protection for Women

Over the past 26 years we have witnessed a tremendous rise in the number of women becoming doctors. These women are contributing to the bottom line of the family income and in many cases they are the primary bread winners. According to Pew Research Center the percentage of married couples in which the women earns more that the man has risen from 6.2% in 1960 to almost 30% in 2011 and is bound to increase.

This is wonderful, however, the reality is with greater income there are many financial issues that women in medicine must deal with, including protecting their income and their families future. For professional women Disability Insurance is must. According to the Bureau of Labor Statistics, Women are more than twice as likely to claim disability while working. Unfortunately, due to this fact they face higher premiums than their male counterparts. The increasing trend of women being the primary bread winners makes having a strong disability policy all the more important. There is no substitute for making sure you and your loved ones are protected from the financial disruption a disability can cause. However, this doesn’t necessarily mean you have to pay top dollar for the best coverage. For most female residents there are association discounts and Uni-sex rates available, making the premiums much more affordable. That said, there are some programs more suitable than others. When you are looking into a disability plan make sure that it contains all the crucial clauses needed to provide the best protection for women in medicine. Should you already own a policy but are unsure if your protection is going to provide what you need, it never hurts to get a second opinion from a specialist either.

Indeed women are working more and earning more than in years past, which means they must take on more of the responsibility for securing their families lifestyle. It is no longer just the man’s job. Having the right disability policy can make the difference between maintaining a standard of living or facing major lifestyle changes for the entire family.

Written by:

Stacia Musleh, Vice President

Income Protection Specialist

The Un-Foreseen Benefits of Transitional Residency

Typically when we think of Transitional year, we think of something along the lines of just another year of education. Yes in most institutions this year focuses on broad based general medicine before entering your primary residency program. But such programs do provide benefits to residents outside of additional medical education, especially when it comes to planning for your future.

Transitional year may appear to be an odd time to start thinking about disability insurance, but all things considered it maybe the best time to start. As a transitional resident you are typically viewed as a better risk than your colleagues in traditional residency programs. This provides two very important financial advantages. First, because of the lower risk class you could receive rates at almost half the price of what you would pay in a specialty. More importantly these rates are locked in forever, and can apply towards future increases in you overall protection, potentially saving you thousands. In addition to advantageous rates you may be able to acquire more favorable protection and language compared to your peers in your chosen specialty. With this said, it appears that the transitional year is more than just broad based learning year but an opportunity that most miss out on.

For more information about Transitional residency disability insurance or any other question contact us at Income Protection Specialist.com. Why trust anyone other than a specialist with your future?

For more articles about disability insurance check out our blog.

Invincible Youth

I can’t tell you how many people I run into on a weekly basis that have no idea of the importance that income protection plays in their lives. Most students and young professionals don’t see themselves as being vulnerable. They mistake youth for invincibility. However, accidents and major health crisis don’t just happen when we are older. They can have a critical and life changing impact on our potential earnings and life style. The best thing, is that when we are young, buying disability protection is inexpensive and within the realm of most people’s budget. You can always increase your coverage amount as your income goes up. Make certain that you don’t become a casualty of your own doing. Protect your income when you are young because you never know what the future holds.

Tuning Up Your Disability Protection Prior to the End of Training

Most residents do not realize that the disability coverge they have already purchased needs to be upgraded to meet the requirements of the Private Sector. Almost all companies will cover any resident in training to a level of $5000 per month. However that’s the equivalent of covering an income of $100,000. Far less than your new income as an associate or JR partner.

After signing your employment agreement the tuning process should begin. If your Specialist is as good as he/she claims to be he will ask to see both:

New Employment Agreement
Schedule of Benefits

For their purposes the new employment agreement will explain the promises you have made to your future employer. This understanding allows him to determine how much additional protection and which companies are appropriate for your new specialty. Insurance companies will not issue amounts over 5-7K a month without proof of income. A full understanding of your benefit package is crucial to your overall protection. The key thing to remember here is that any Disability Benefit promised by the employer needs to be listed on the application. These figures will be used to determine how much additional coverage you are eligable for if any.

In other words if you currently have a $5000 benefit and are promised an additional $15,000 under a Group Disability program provided by your employer, you have a total coverage $20,000 per month. If your income is too low then no further coverage will be offered to you by the insurer. Your only hope is that your income grows to a much higher level or that the Group Benefits being offered are voluntary. Voluntary means you can opt out not accepting the less desirable group protection because you will pay the premium yourself. If no benefits are being offered or the plan is voluntary then you would be eligible for addional coverage varying on your specialty and the carrier.

The only way your protection will keep pace with your earnings is through diligent work between you and your specialist. If you haven’t heard from your agent since the original purchase then maybe he/she isn’t the the Specialist he/she claimed to be. If that’s the case you need find someone who is truly an expert in the field. Why trust anyone other than a Specialist for your income protection needs.

By Stacia Musleh

Vice President

Employer Provided: Group Long Term Disability (LTD): Delivers Short Comings not Peace of Mind!

Group Long Term Disability (LTD) is a benefit normally given to physicians from
their employer for free. The downside is that this benefit isn’t free of side effects.

False sense of security: Group LTD benefits are not equal to non-cancelable protection. However given that other benefits offered by employers are top notch creates the illusion of quality. One example is that True Specialty Specific /Own Occupation is never available in an LTD plan.
Up to 60% of income protection is not 60%: There is always a maximum dollar amount stated usually it’s a number between $5k- $15k. However this is only a starting point, a group carrier determines the maximum you could be eligible to receive. Then it is reduced by any Social Security/Workman’s Compensation you do receive. Benefits are then reduced or eliminated by any income you may generate on new income you earn from all sources. Last but not least the benefits are reduced by taxes. Yes the benefits are considered earned income and taxed accordingly.
Benefits are not portable: If you leave your employer and are not insurable you will be out of luck.
Group LTD benefits limit/eliminate your ability to purchase individual protection: Individual carriers will recognize any coverage you have in effect to determine how much (if any) they would be willing to insure you for. In other words, before hiring on with any new employer you need to max out your individual policy.

Insurance is meant to give you peace of mind. Group LTD policies with all of their short comings, can’t deliver the security The Medical Profession has come to expect.

What Medical Residents Need to Know about Disability Insurance.

Many residents fail to recognize the importance of a properly written disability contract. Ironic considering, that you are gambling with $10 Million Dollars of future earnings. You have sacrificed personally and financially to get where you are today. It would be catastrophic if it were all lost due to a lack of planning or interest on your part.

Unfortunately finding the correct policy has become very difficult due to a number of different factors.

Very few companies offer the Specialty Specific “Own Occupation Protection” needed to protect you in your medical specialty.
Unscrupulous employees of insurance companies sell less than adequate policies to physicians for commissions and to fill their quotas. Simply put, you need to do your homework if you want peace of mind.

But what is disability insurance and what are the benefits that should be included in a properly designed policy for medical professionals?

Disability Insurance: At its most basic definition is a contract that provides life support when you are unable to support yourself. In other words it provides monthly checks when an injury or serious illness prevents you from working.
Specialty Specific/Own Occupation clause: This is the first clause that should be in all medical professionals policies. It should read that if you are unable to work in your Medical Specialty because of a covered Disability, then you would be considered totally disabled. This should be true even if you establish a new occupation and are earning more than your old specialty income. Please note: Currently there are many different definitions of Own Occupation being sold today, all of which claiming to be the best definition.
Partial Disability Benefit/Residual Benefits: While there is a greater chance for a medical specialist to become totally disabled then a white collar employee, there is an even greater chance of becoming partial disabled. This means that you are still able to work in your specialty on a limited basis because of a covered Disability and experiencing a 20% loss of earnings. This rider allows for compensation if you are partially disabled. You would receive a portion of the total disability benefit. The percentage of the benefit you would receive would equal the percentage of lost earnings you are experiencing.
Inflation Protection Rider: In the event you are not independently wealthy, you may wish to consider a Cost of Living Benefit rider. This benefit would increase your benefit for a prolonged residual or total disability lasting 365 days or greater.
Future Purchase Option/Guarantee of Insurability Rider : It protects your ability to purchase more protection in the future regardless of your current health. This benefit is vital to protect your future earnings.
Non Cancelable Guarantee Renewable: Means, the policy cannot be changed or cancelled and premiums are guaranteed never to increase. In other words you own the policy and no-one can take it away or change it.
Elimination Period: This is considered a time deductible and is standard for all disability contracts. An elimination period is the number of days that a Disability must elapse before the policy starts owing you money. A 90 day elimination period is most commonly chosen and priced considerably less than 30 or 60 day elimination periods.
Benefit Period: Is maximum payout period the company will pay you for a covered Disability. Most Doctors choose to receive benefits until age 65. Other benefit periods include age 67, 70 and Lifetime payouts.

Now that you know what should be in a properly written contract you need to know what to avoid.

Group/association policies: Even though they are cheaper they are no substitute for properly designed protection. Beware, if you do decide to buy group/association protection, you will get what you pay for. These policies provide very little protection when you need it the most, at claim time in addition the quality of definitions needed by Physicians are just not included in this variety of contracts.
Avoid being SOLD: You must do your homework when purchasing this vital protection. Something as important as $10 million should be given the attention it deserves. To assist you with this endeavor I suggest find a specialist who is independent and cannot be influenced by company politics or shareholders whims. They will be able to guide you through this daunting task while educating you along the way.

As a Physician your ability to earn an income is your most valuable asset. Choosing the right disability policy might become the most important purchase you ever make. It can mean the difference between financial security and bankruptcy.

Testimonial

My specialist showed me multiple choices educating me on the differences so I could make an informed purchase vs. being sold I would refer them to anyone.

C. Harold
Orthopedic Surgeon
North Carolina

Their knowledge and thoroughness was comforting. I often recommend them to other Radiologist.

B. Rodgers
Radiologist
San Diego, CA

Even though I have unique medical history they were able to acquire me preferred Disability Income Insurance when others were not… I highly recommend…

Ryan N.
Anesthesiologist-Pain Managment
Indianapolis, IN