| ssional Disability Insurance | | | | of the major differences between writing |
| What It Is | | | | professional DI policies and others is that social |
| So-called professional disability income insurance can | | | | insurance benefits are not large enough in comparison |
| address a combination of business and personal | | | | to actual earnings to interfere with the income |
| needs since the professional person's work is the | | | | replacement calculations and cause over insurance |
| source of income that pays for both business and | | | | problems. |
| personal expenses. For insurance purposes, | | | | The Key to the Professional's Livelihood |
| professional DI policies are those written for | | | | Reading the list of typical professional occupations |
| people in certain occupations that generate incomes | | | | above, you can see that these are people who |
| over $100,000 annually. Insurers write professional | | | | provide vital services for society and who are |
| policies for individuals who need income replacement | | | | frequently self-employed. Performing these services |
| in the range of $20,000 to $30,000 per month. Since | | | | is the key to the professional person's livelihood. The |
| not every insurance company is willing to provide | | | | inability to earn income by performing these services |
| monthly benefits in these amounts, you will want to | | | | affects not only personal finances, but also the very |
| locate those that do in order to serve this market. | | | | life of the business itself since it is those services |
| Income, however, is not the only characteristic that | | | | that keep the business operating. |
| defines this group. Eligibility is generally restricted to | | | | Consider, for example, a self-employed physician, |
| professionals who are independent and | | | | operating without partners and employing a small |
| self-employed, but highly compensated executive | | | | staff. If this individual is unable to work, first of all, no |
| employees might also be considered. Typical | | | | income is generated to pay for personal expenses. |
| occupations acceptable for professional DI insurance | | | | Second, no income is generated to continue the |
| includes physicians and other health professionals such | | | | medical practice by paying ongoing business |
| as dentists, optometrists, psychiatrists and | | | | expenses, including a substitute physician to see the |
| pharmacists; lawyers: accountants; engineers; | | | | disabled doctor's patients. If a medical practice shuts |
| architects; and some executives, generally PhDs or | | | | down temporarily, patients must look elsewhere for |
| those who are otherwise highly educated. This is just | | | | services and there's no guarantee they will return |
| a sampling of eligible occupations. The companies you | | | | even if the disabled physician recovers. The physician |
| represent provide a complete list of occupations they | | | | is likely to suffer a double loss: current loss of income |
| will consider for professional DI policies. | | | | and loss of the business he or she might have spent |
| Aside from the large dollar benefits involved, | | | | years building. There is no substitute for disability |
| professional DI policies operate essentially like any | | | | insurance to overcome these problems. Later you'll |
| other individual policy. As indicated in an earlier | | | | also learn about some specialized disability policies that |
| chapter, professionals are eligible for the most liberal | | | | address ways to keep a business intact during the |
| benefits of any occupational group. Chapter Eight of | | | | disability of someone whose active working presence |
| this text discusses the various occupational classes | | | | is key to the business. |
| more fully. Because of the high incomes involved, one | | | | |