Many physicians purchase life insurance or receive it as part of their benefits package, but they often do not carry appropriate disability insurance to cover their income should they be unable to perform their job. In fact, "after an accident, disability occurs four times more frequently than death, and its financial impact on the family is often more severe than death," financial advisor Michal Zhuang, founder of MZ Capital in Washington, D.C., wrote in Physicians Practice.
Therefore, when selecting disability coverage for yourself or your physicians, keep the following tips in mind:
Know the definition of "disability."
Some policies won't consider a physician disabled if he or she can still perform some type of medicine, even if it's not in that person's specialty, Jeff Brunken, president of the Salt Lake City, Utah-based MGIS Companies, told Healthcare Finance News. For example, a surgeon would want to ensure that a hand injury that kept him or her from operating would be covered, even if the doctor was well enough to see patients.
Understand the definition of "income."
Many insurance policies define physicians' income as their base pay, without factoring in incentive pay, HFN noted. With more physicians in employment arrangements or belonging to accountable care organizations that link higher amounts of income to performance incentives, this is a major pitfall to avoid.
Hire a fiduciary financial advisor.
According to Zhuang, it's critical to purchase insurance from a person whose opinion is not slanted by commissions. Advisors who are licensed to give advice and are compensated by clients' fees are the least likely to have a conflict of interest, he wrote.