Margarita Calpotura Business Law Blog on Lawyers.com

My good friends, RJ Kelly and Fatema Qassimyar, investment and wealth advisors with whom we work in our business and estate planning  practice provided the following valuable information about the benefits of disability insurance.   We agree that disability insurance is an important planning component of any business/estate plan.  As such, we provide the following information as a service to our clients and blog readers.  For information about estate planning or about RJ and Fatema, feel free to contact business law attorney in CA, Mitch Miller, at mmiller@millerlg.com.

Why should I consider disability insurance, and what are the “flavors”?

48% of home foreclosures are the result of a disability. One out of three Americans age 25 will have a disability before age 65 that lasts at least  at least 90 days. The average length of time for a disability depends upon the age of the person disabled, but is generally over three years or longer. It has a 3-6 times greater likelihood of occurrence at any point in time than being killed. And yet, it is frequently an area that Americans either have no or too little coverage.

There are six specific areas in which disability coverage should be reviewed for individuals and businesses today:

1.       Income replacement (even if covered by insurance at work, there is usually a significant shortfall in benefits received vs. income earned while healthy)

2.       Business overhead reimbursement (are there commitments for rent, salaries, phones, etc. that will be ongoing even if disabled?)

3.       Retirement plan contributions (to be used to fund a retirement plan in the event of the individual’s disability)

4.       Buy-sell agreement funding (money to buy out a partner after a period of time in the event of a disability)

5.       Equipment or loan repayments (often, payments run longer than the typical overhead reimbursement contract limits. This is to cover the amount of principal and interest due on the loan payments for as long as necessary.)

6.       Key person coverage (for the business to be used in hiring a replacement and the expenses associated with bringing on an interim or replacement executive or professional)

For additional information, questions, quotes or to request a speaker for the topic, please send an email to info@wealthlegacygrp.com or call (800) 975-5355, x111 or (619) 972-4488 (direct).