1. Disability Coverage Dr. AA Neidermeyer

2. How will bills be paid? • From current checking account • From emergency fund • From wages under sick days/vacation policy • From loans

3. Acquisition highly recommended Premiums<2% of gross income Check with employer first Protects income not position Risk assumption: suggest insuring for the long-term Obtain a non-cancelable or renewable policy Get COLA & premium waiver Policy Parameters

4. Key Policy Contents • Policy definition of “disability” • Waiting period • Benefit period • Magnitude of benefit

5. Definition of Disability • Usual definition of “disability” is the inability to perform your current position responsibilities. • This interpretation normally holds for 24 months and then your abilities are interfaced with all position requirements to determine if you can perform.

6. Waiting Period • The selection of a waiting period before a claim is filed determines your policy premiums. The shorter the waiting period, the greater the premiums. • Select a waiting period based on your financial circumstances and willingness to pay the required premiums.

7. Benefit Period • Most disabilities last three years or less. • Do you want to assume that you’ll be within this range? • The longer the benefit period chosen the greater the premiums.

8. Magnitude of the Benefit • Policy requirements prohibit benefits in excess of two-thirds of your previous income level. This limit is in place to preclude financial enrichment at the expense of the insurance company for a lengthy period.

9. Suggestion • Self-reflect to determine the magnitude of coverage you need in this area by interfacing your financial resources with your financial responsibilities. • Obtain coverage through your employer, your professional associations or by way of an individual policy.