Life Insurance and Income Protection for Dentists

Whilst many insurers offer generic Income Protection policies that are easily accessible, there are a number of professions whose specialised natures require a more tailored approach.

As a specialist insurance advisory group, we at Curo Financial Services are here to help you pull aside the red tape and cut a swathe through the myriad of articles out there just trying to pitch their insurance. We don’t sell insurance, we just provide advice. Read on for a detailed-yet-usable account of what to look for in Income Protection if you’re working as a dentist (or dental surgeon, dental hygienist, dental nurse etc).

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There are a few key ingredients that are essential to cooking up an Income Protection policy that is tailored to those in dentistry:

High Income Cover: a specialised profession often means you’re on a fairly large salary. It’s essential not only to ascertain the right amount of cover to suit your needs, but also to select a policy that will provide a large amount of cover at a reasonable price, without sacrificing quality.

Mental Illness Cover: it’s not something people enjoy discussing but it’s crucial to consider nonetheless. The high stress and taxing nature of the medical industry means you’re statistically more susceptible to mental illness that could prevent you from working. Make sure your cover doesn’t exclude mental illness in the fine print.

Blood Borne Diseases: some infections such as HIV and Hep B/C can prevent you from working even though you’re capable of doing so, as you have to interact physically from patients. Policies between insurers differ wildly in their cover of these diseases, so it’s important that you make sure you’re aware of the definitions of each policy you are considering.

Self-Employed: being self-employed throws a spanner into the works of regular insurance, as it changes the risk profile to which you are exposed. Make sure you understand the ramifications of each possible scenario that could arise as a result of your injury or accident, and plan your insurances accordingly.

What’s the prognosis, doc?

With each of these considerations, there is a lot of material to get through. Each insurer has a different set of definitions and conditions, and familiarising yourself with any particular product’s advantages and disadvantages is a task in itself—you might even say it’s like pulling teeth. This is where an adviser can help, to ensure that you receive a tailored risk protection package to systematically cover you against a loss of income.

We at Curo Financial are uniquely placed to offer access to specialised insurance policies that are otherwise unavailable to the market. We have developed strong relationships with insurers that enable us to provide our valued clients with a level of service and access to products that is hard to come by elsewhere.

Clichéd as it may be, the devil is in the detail. Read on for an in-depth analysis of the points mentioned above. Remember though, nothing can replace the specialised knowledge and expertise of an adviser.

The Finer Points Of Income Protection Insurance For Dentists

Income Protection insurance is calculated as a percentage of your total salary, designed to incentivise returning to work after an injury or illness. You are eligible to receive 75% of the first $26,666 of your monthly salary, 50% of the next $20,000, and 20% thereafter.

As a general rule, we usually recommend that you insure for the maximum amount available to you, to ensure that you are able to continue to meet living expenses in the event of a loss of income. Where an advisor can really help is in singling out a policy that accommodates high income earners. As with anything, some insurance products are better than others, and you get what you pay for. Often however, amongst high-quality products one will be extremely advantageous for a particular person, whilst at the same time sub-optimal for another. It is all dependent on your individual circumstances, and the specifics of what you require from your policy.

Some key characteristics to look for are Increasing Claims benefits, Specific Injury benefits, and a lengthy benefit period – we recommend to age 70 where possible.

Also important is the distinction between Agreed Value cover and Indemnity cover. If you’re self-employed this is a particularly serious consideration – refer to the ‘Self Employed’ heading below for more details. Essentially, an Agreed Value style policy is one in which the level of your income is specified at the establishment of your policy contract. It is this level of income which will provide the reference point for your benefit should you be eligible to claim on your policy. Even if you are earning less than you are now, you will still be eligible for the benefit payment agreed upon at the establishment of the cover.

Conversely, an Indemnity style policy is one in which your benefit payment will be assessed against your income immediately prior to the time of claim. “Immediately after” generally refers to your 12-month income before your claim, or to your best 12-month income over the three years before your claim (depending on your insurer and policy). This means that if your income has gone down since you took out the policy, you may not be eligible to receive the full benefit amount for which you were paying.

Mental Illness

Unfortunately, mental illness is on the rise. Professionals in the medical industry have a statistically greater chance of mental illness than others. It’s in your best interests to make sure that your Income Protection policy is watertight when it comes to mental illness.

The first thing to consider is the framework of definitions that surrounds mental illness in insurance. As always, each policy is different and the best course of action is to seek out the advice of a specialist to recommend a policy that will pay a benefit in the event of your loss of income due to mental illness.

The second consideration is relevant to those who have had a personal or family history of mental illness. In many cases, insurers will issue policies with blanket exclusions on mental health if you have been previously affected by a mental illness. However, it is possible to minimise the effects of these exclusions. A good adviser will be able to leverage existing relationships with insurance companies to arrange favourable terms on your policy, and thereby reduce the chances of you being caught without an income in the event of your mental illness.

Blood Borne Diseases

As I mentioned above, as a dentist you are particularly susceptible to a loss of income from diseases that are otherwise increasingly manageable. HIV, Hep B and Hep C are all conditions that can be lived with under a well-considered treatment program. The client-contact nature of your work, however, can prevent you from continuing in your occupation – even if your normal day-to-day life is relatively unaffected.

In such a situation, income protection insurance can be invaluable. To ensure that the fine print of your policy covers you in industry-specific situations such as this, enlist the help of an advisor when searching for income cover and throughout the application process.

Self-Employed

The tricky thing about it for the self-employed is obtaining a level of insurance that reflects your actual income. Basically, there are two types of income protection insurance—indemnity and agreed value. The lower cost of indemnity cover can be tempting, but be aware that to be paid out the full benefit amount under your policy, you must be able to prove at the time of claim that the benefit amount does not exceed 75% of your income.

This can be significant for you, being self-employed. If a bad period for the business precedes your claim, you may only receive a percentage of the benefit to which you thought you would be entitled. For more information, refer to our in-detail articles on income protection insurance and the self-employed; for now, just understand that a careful consideration of the terms of your cover is necessary to ensure it is right for you.

More information about income protection for the self employed can be found here.

If you’ve made it this far, congratulations. Taking the time to properly understand the elements of your insurance policy can not only save you money by helping you to select an efficient policy in the first place, but can ensure that you can fully rely on your policy when it is most crucial – at claim time.

An advisor is a recommended element of this process. Not only will an advisor recommend a policy that is optimally suited to your specific needs, any good company will stand by you throughout the claims process. At Curo Financial Services, we handle the entirety of each claim for our clients, to take the stress and difficulty out of what can be a trying time. We also leverage long-standing relationships with insurers that we have forged over the years to ensure that our clients receive the best outcome from their claim that is possible.

General Advice Disclaimer

General advice warning: The advice provided is general advice only and in preparing it we did not take into account your investment objectives, financial situation or particular needs. Before making an investment decision on the basis of this advice, you should consider how appropriate the advice is to your particular investment needs, and objectives. You should also consider the relevant Product Disclosure Statement before making any decision relating to a financial product.

Don’t put off your insurance until it’s too late.
Call Curo now to speak to your personal advisor, on 1300 665 356.