MDNews - Central New York

++++++++++++++++++++++++++ BENEFIT SPECIALISTS +++ +++ ++++++++++++++++++++++++++ + + The Importance By Peter L. Derrenbacker, CLU, ChFC, CFP W HAT IS THE most important asset you have? For most of us, it is not our house or our car — it is our income. Let's assume you are a 40-year-old physician earning $250,000 per year. Assuming you work for the next 25 years and your pay increases by 3% per year, your total earnings by age 65 will be greater than $7 million. Over time, your cumulative earnings will far exceed the value of any other asset you own. Your income protects your family's lifestyle, helps pay for your children's college education and allows you to invest in your retirement accounts. For a physician, having adequate long-term disability insurance is critically important based upon the "asset" being insured. It's sometimes hard to imagine a disability can happen to you. So what are your chances of becoming disabled? Twenty percent of "white collar" professionals will suffer a disability lasting at least 90 days during their working years.¹ Being out of the workforce, even for a short period of time, could have lasting repercussions on your financial well-being. And not only will you experience falling income during disability, but the potential for greater expenses like health care, special equipment, health aids and transportation will be added costs to consider. There are several disability products available in the market- place, some of which you may already have: New York State statutory disability: Covers "off-the-job" 16 | Central New York MD NEWS s MDNEWS.COM of Disability Insurance PART ONE OF THREE injury or illness and pays 50% of income up to $170 per week. The waiting period is seven days, and benefits last for as long as 26 weeks. Total disability is required. Workers compensation: Covers "on-the-job" injury or illness and pays 66% of average weekly wage up to $739.83² per week after seven days of disability. Benefit amounts will be adjusted based upon your percentage of "disability." Partial disability is covered. Social Security disability insurance: Must be totally disabled and your disability must have lasted, or be expected to last, a minimum of 12 months. You must be unable to earn an income greater than $1,000 per month. Group long-term disability: Offered through place of employment and covers "on- and off-the-job" injury or illness. The waiting period for benefits is typically 90 or 180 days and covers on average 60% of pre-disability income up to a maximum monthly amount that varies by plan. Benefits are usually payable up to age 65 or Social Security normal retire- ment age. This coverage is typically offered without medical evidence of insurability. It may be paid for by employer, employee or a combination of both. Individual long-term disability: Purchased by you separately through an insurance carrier. Some of the features include total and partial disability coverage, portability, indexed/cost of living adjustments to keep pace with inflation,

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