Disability Expense And Loan Coverage

BUSINESS EXPENSE DISABILITY
For The Self Employed A Disability Means Double Jeopardy

  1. Loss of Personal Income and
  2. the responsibility of ongoing Overhead Expenses

As a self employed professional, the threat of disability presents you with financial problems on two fronts. Not only must you continue to pay your personal expenses, but you must also pay the overhead expenses associated with your business.

How will you pay for your ongoing fixed expenses for a Short-Term Disability, 6 months to 18 months? Or for a Long-Term, Career ending Disability?

Possible Non-Insurance Solutions
• Accounts Receivable -
How long will they last?
• Borrow Funds -
Will banks lend, if you cannot repay?
• Delay payments -
Possible damage to credit
• Use personal Savings -
For how long?
• Personal Disability payments
Will you have enough for home and business?
• Layoff Employees -
Will this effect your return to work or your sale or your practice?
Advantages of a BOE Disability Policy
• Tax Deductible as a business expense
• Benefits for 6 – 24 months, enough time to return or ample time to sell
• 80% Refund of Premium Available
• 100% Refund with Surrender Value Benefit
• Total Disability Never Required in some plans
• Loss of Gross Earnings of 20% or more from accident or sickness qualifies.

Reducing Term Loan Disability Insurance

  1. Problem:
    You borrow money for a purchase of a new practice or for an expansion. As long as you can run the business, the loan will be repaid from your earnings. But how is that loan going to be paid off in the event of your death or disability?

    Many banks require you to insure for the loan to be paid off in the event of death or disability.

  2. Solution:
    Term Life - to pay off the loan in the event of your death. Most dentists purchase Term Life insurance to pay off the loan in the event of death.

    Reducing Term Disability - This policy is specifically designed for the payoff of a loan in the event of a Disability.

    • Payment - you can insure up to 80% of the loan payment
    • Term - you can match the period of coverage to meet the terms of the loan. e.g. 84 months for a 7 year business loan.
    • Low Cost -The reducing benefit structure allows the carrier to price coverage much lower than traditional coverage.
    • May be a Tax Deductible Business Expense. Please contact your accountant or tax advisor about the tax deductibility of these premiums.


    Insure your loan with Reducing Term Disability instead of your personal income policy!

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