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What Every Physician Should Know About Life Insurance

August 21, 2023 8 minutes
Mid-Career Physician

You’ve been in practice for 10,15, maybe 20 years. Your income has grown, and your priorities have changed. You’re focused less on paying off student loan debt — that’s under control—and more on building a solid financial platform that will sustain your desired standard of living.

Whether you’ve just started to accumulate resources or already have a robust portfolio, think about protecting those hard-earned assets and your family’s financial well-being. Do you have enough life insurance?  What would happen to your family and your assets if you were to be disabled for a long period of time?  Would your current disability plan cover your expenses, or would you be forced to tap into your assets?

Ask these questions about your life insurance portfolio.

  • Am I depending on an employer-provided life insurance plan?
  • What has happened to my income since I last reviewed my insurance coverages?
  • What has happened to my family? More children? Children becoming independent? Parents becoming dependent?
  • If something happened to me, how much debt would my family be left to cover? For how long?

Questions like these can help you determine whether you need more life insurance and what kind might be best. The questions of exactly how much and what type of life insurance you need are best answered by consulting an insurance specialist who is well-versed in the financial needs of physicians.

Now, take another look at your disability coverage.

Your physician disability coverage is another area that needs scrutiny, whether you are in private practice and providing it for yourself or are employed and covered by an employer-sponsored plan.

  • First, review your current disability income insurance coverage.
  • Has it kept pace with your income?
  • Would your current disability coverage sustain your family if you were laid up for a long period of time? ( Remember that the average disability claim is almost three years.[1])
  • Is the benefit taxable? If the premium is paid by your employer, it could be.[2]

Now, look for the words “any occupation” in your current disability income insurance policy. These words may tell you that benefits will stop when you are capable of performing any activity for compensation. Physicians are best protected by policies that pay until the policyholder is fully capable of performing their own medical specialty.

When your answers to these questions tell you that you might need more insurance or if you don’t know the answers, it’s time to consult an insurance specialist, one who understands the unique needs of the medical profession. Your professional association is a great place to look for any number of reasons.

A Physician Insurance Specialist can help you determine how much insurance you may need—that’s a custom calculation, not a formula. They’ll help you make decisions about term life insurance vs. whole life, level premiums vs. stepped premiums, and more. They’ll also help you fill any gaps in your disability coverage.

For 35 years, AMA Insurance has worked with and for physicians like you every day of the week so you can depend on their knowledge and experience. You can trust their choice of insurance underwriters and physician-focused insurance solutions. Their team of Physician Insurance Specialists are salaried employees, not commissioned salespeople, and their sole interest is what’s best for you.

[1] The Council for Disability Awareness. “Overview.” 2023 https://disabilitycanhappen.org/overview

[2] Consult your tax advisor on this.

Schedule an insurance review now.

Finally, and this is important, this personal insurance review is not something to put off. We always hope that illnesses and accidents will not occur, but they do, and by being prepared, you protect your loved ones and your financial future. There’s another purely practical reason: insurance premiums are based on risk, and that risk grows as you grow older, so the pricing you’re offered today by any underwriter is likely to be the best it will offer.

Take a look at your insurance coverage now and fill the gaps you find. There’s a Physician Insurance Specialist waiting to help you.