Mike Bark is joined by Dave Dorley, Director of Disability at Third Coast Advisors and one of the go-to's for the Wisconsin Dental Association as an expert in disability and life insurance. The guys talk about how disability and dentistry collide. Visit http://www.bullmoosefinancial.com for more information.
What does disability cover in the dental industry?
I believe that one of the greatest financial threats is somebody's income being depressed or going to zero. So I look at disability income protection as a foundational piece that most dentists are fairly aware that their ability to practice and continue to do procedures are important. However, there are numerous differences as you get into evaluating it. That's where I come in. I compare and contrast different options that the dentists have, but 90% of disability claims are due to illness versus injury. Sometimes that is pretty surprising. I have three or four claims going right now and they're all illnesses, they're all either conditions that somebody is receiving treatment for, or progressive type diseases that cause their production to become depressed for a period of time.
Does the disability insurance come in as a stopgap to their income stream?
Absolutely. We can't insure 100 percent of somebody's income, the insurance companies will issue about 70 percent of somebody's income to replace. They want to have some inherent incentive for people to return to work, but yes, it is a stopgap for when income goes down.
When is it a good time for a dentist to get disability insurance? Early in their career as a dentist or when they start making some real money?
We always like to say do it early. Getting disability insurance is not generally easy for everybody. So any kind of medical condition could occur, that could include mental nervousness, it could include some sort of surgery or condition that could come on as their career is progressing. So getting it early is really important because it is medically underwritten, where you'd have to answer certain medical questions on how healthy you are. And so early is better. It's also really important to get it early to lock in pricing that's guaranteed to age 65 which, usually, will cover somebody for their entire career. So, early to avoid any kind of limitations due to medical history and early due to pricing lock ends.
What is the process of getting the medical underwriting that's needed?
As you'd imagine, the process has changed. In most cases, the insurance company would hire a nurse to go visit people at their homes. Now, the process has advanced to a level where labs with blood and urine aren't required for most cases. Nowadays, most of the time it's medical questions. The COVID pandemic has advanced us to most places not needing the kind of fluid testing to basically never needing to do them. It mostly involves disclosing medical history and answering medical questions with records being requested by insurance companies to verify.
Are there any special considerations dentists need to think about when getting a disability policy or putting one in place for their practice?
There are about seven or eight companies that do individual disability that's individually written and what's called non-cancelable. What non-cancelable means is that the insurance company can never change it once they've given it to you for life until age 65. So where it gets a little nuanced and important for dentists is, in the partial disability benefit rider, it's extremely important for a dentist to have what's called an enhanced partial rider. There are many cases where somebody may become totally disabled for a period of time and get treatment, they don't die, they return to work, but they're slower. So they're just not as productive for whatever reason. About 85 percent of the policies out there, at that point - if they're doing everything they did before, and they're working as long as they did before, but they're just slower - most policies are going to stop paying benefits. So the doctor earning $300,000, that's now earning $200,000, with most policies on the market, those benefits are going to cease at that point. So we have to be really knowledgeable about how these riders on the partial disability benefit area work and there are only a few companies that offer those types of riders.
Listen to the episode for more information on how dentists can successfully implement disability insurance for themselves and their practice!
Talk about how disability insurance can benefit you with Bull Moose by visiting http://www.bullmoosefinancial.com or calling (414) 759-9629 today.
