Unfortunately, a lot of people haven't considered the fact that one day they may become disabled. Most will readily admit that contracting cancer, having a stroke, or sustaining a long term disabling injury is a real risk, but all too often those same people say it won't happen to them.
Your income is such a valuable asset, but for many, it is something that is assumed and even taken for granted. When I discuess this exposure with the business owners I serve, I always as the same question:
How long could you go without an income?
Let's assume you have a savings rate of 10% of your annual income per year. Just one year long disability could wipe out 10 years of savings just to support you while you recover! Now what if you couldn't work for 2 years, 5 years, or what if you contract Myasthenia Gravis like my uncle and become bedridden for many years?
Having an income during this painful time, doesn't make the situation better, but it sure does relieve a huge burden for you and those supporting you. And the cost to provide that protection is not nearly as expensive as you might think.
Here's how long term disability insurance works:
What are the chances of becoming disabled?
- rovides a smooth transition of control and ownership
- Avoids ownership by unwanted parties and potential disagreements about business decisions
- Reassures creditors, suppliers, customers, and employees of the continued viability of the business
- Helps ensure the legacy of your business
What are some claim examples?
- Binding on all parties and prevents future negotiations and disputes
- Locks in a buyer for the business interest
- Helps ensure your heirs will receive a fair value when they sell
- Time frames and payment terms are agreed upon ahead of time
- Helps make sure the active owner(s) retain control of the business
The Insurance That Replaces Your Income
- Liquid cash is immediately available upon an insured owner's death
- Tax-deferred growth of cash value
- Death Benefit is generally received income tax free
- Disciplined means of setting aside funds
- Policy cash value can be used toward a lifetime buyout or for financial emergencies