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5 Important Disability Income Questions Financial Professionals Need to Ask

5 Important Disability Income Questions Financial Professionals Need to Ask

| May 09, 2019

1. How much does the company-sponsored plan pay? This is by far the most missed opportunity I see. Financial professionals too often only ask IF their client has disability insurance. That’s taking a survey, not strategizing.

Group LTD plans usually have maximum benefits, only cover salary, and are typically taxable, sometimes leaving your clients with significant gaps in coverage.

2. When does the company-sponsored plan pay and for how long? When a full analysis is conducted, we often discover that the company-sponsored plan doesn’t provide complete protection. This usually surprises the client because they thought they were taken care of!

3. For Physicians Only: Does the plan address the unique occupational duties of a physician? Physicians often have split duties where some of the practice is “clinical” consulting with a patient, and some of their duties are “procedural” administering a treatment. It’s important that they have a policy that addresses their unique needs.

Want to know more about working with physicians? You might want to read an article I wrote about the unique planning needs to be aware of when working with doctors. (

4. When does the disability income insurance start? This can go either direction, and some folks have a plan that over-compensates and some under-compensates the real need. Especially if your client’s financial situation has changed since they first purchased their policy, it’s a good idea to review coverages so that they match up well with your client’s existing resources and needs.

5. Are retirement contributions covered? The short answer is most often, no. EVERY retirement plan needs adequate contributions to reach the client’s goal. There is simply no way around this, and most disability income plans do not cover retirement contributions. How would it help your clients most to have a more reliable retirement plan strategy?

Income is an important factor to consider when reaching your financial goals.

Bonus: For the Business-Owner Only

6. How quickly would your business lose its value if you weren’t there? Especially when working with fee-for-service professionals like attorneys, accountants, medical professionals to name a few, the business value would drop off a cliff if the professional was not around to administer their services. This is a fine opportunity to look into a business overhead expense plan to keep the business more valuable while your professional client heals or solicits a sale of the business. Business’ are generally more valuable when profitable!

Cash-flow is an important factor when considering business value.

Need help with a review, plan design or marketing your practice? Give me a call at (205) 626-9347.