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As an attorney, you know the importance of the fine print in any contract. When it comes to disability insurance policies, you need to make sure you have one of the strongest definitions of disability. This determines whether or not the company will pay your claim if you are disabled.
The strongest kind of contract is one that is Non-cancelable, guaranteed renewable with a lifetime own-occupation definition. This means that the policy will pay you a benefit if you can't practice as an attorney, even if you choose to work and earn money in another occupation. Your benefit will not be reduced by any other income you make. This is not the case in some policies marketed as having "own occ." Be sure to read the fine print in the contract. You may even request a sample policy to confirm that your policy has these provisions.
If you run your own practice or are a business owner, please be sure to check out the Business Owner pages on this website. You may be a candidate to cover some of your business overhead needs or a buyout in the event of a disability.
As an attorney, your occupational class is among the best available. What this means to you is that your rates will be more affordable than those in other classes considered riskier, such as physicians. Attorneys can purchase up to a maximum $15,000 of monthly benefit.
- Your most valuable asset is your ability to bring in an income. In your case, your future income is your payoff for all of your years of training, hard work and accumulated debt.
- You may be eligible for a group rate or discounts. This requires two or more employees at the same firm/employer to purchase a policy.
- KF offers discounted rates to some associations. Please call our office for more information.
For more questions or more information about discounts, please contact KF Financial.
If you work for a firm, you may be offered a group policy. Usually you cannot opt out of taking the policy. Group policies usually offer a limited monthly benefit (60 percent of your income to a maximum amount). Because group policies can't discriminate who they are offering coverage to, they often lack the important provisions of a personal policy.
- Your group policy may require you to be totally disabled and not able to work in any capacity before you can receive any benefit.
- The benefit may be taxable income to you if the employer is paying the premiums.
- Your employer may cancel your policy at any time.
If you ever leave your firm, you can't take your group policy with you.
- Even if you have a group policy, it is still important to consider supplementing with an individual policy.
- Your individual policy is portable and you may take it with you if/when you leave your employer.
- The policy definitions on an individual policy are usually superior (own-occupation, inflation protection).
- If you are only partially disabled, your group policy may not pay you.
- Having an individual policy protects your insurability by purchasing increase options. If your health changes, you may still purchase more in the future based only on financial underwriting.
If you are starting your practice or career, you may be concerned that disability insurance won't be affordable. There are several things we can do to reduce your premium as much as possible.
- • Some companies allow a "graded" or increasing premium. This is initially less expensive and your premium will increase each year. If you wish to lock it in at a later time, you may do so on any policy anniversary.
- You may choose to simply supplement what your group policy already offers and load up your policy with increase options. This will allow you to keep your premium low during residency and still reserve the right to increase it in the future without any medical underwriting.
As a first-year attorney, you have a couple of disability insurance options.
- First-year attorneys automatically qualify for $3000/month benefit regardless of income.
- You may qualify for benefit based on your actual income.
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