OMA Insurance Services has prepared a four-part series of planning tips to help physicians manage their insurance and financial needs at each stage of their career — from early practice to retirement. The second instalment (below) provides practical advice for physicians entering the "Mid-Career" stage of practice.
The mid-career stage can be a satisfying time, during which things often begin to fall into place both personally and professionally. After years of hard work, you are now solidly established in your profession and enjoying the increased financial freedom that comes with success. And, for some, it may also bring the rewards and responsibilities of marriage and children.
Whether you are married or single, changes in your income level, lifestyle, and financial obligations at this stage in your life all have an impact on the type and amount of insurance protection you need.
From buying a bigger home to saving for your children's education, a growing family usually leads to an increase in your financial responsibilities. It is important to have sufficient life insurance to cover your mortgage and any other debts, while also providing a sufficient amount to replace your income and provide for your family's future needs in case of death or a life-threatening illness.
As a medical professional, you know that cancer, heart disease and other serious illnesses can happen to anyone at any age, regardless of overall health or family history. You also know how important it is to be able to minimize stress and take the time needed to recover.
The OMA's Critical Illness (CI) insurance provides a lump sum benefit payment if you are diagnosed with one of the 24 illnesses covered under the plan. Since there are no restrictions on how you can spend the benefit payment, it can be used to cover your regular monthly expenses so you don't need to dip into your retirement fund or other savings.
Consider purchasing CI insurance for yourself if you are single or the primary household income earner, especially if you already have the maximum allowable Disability Income insurance coverage, and it is not enough to meet your total monthly income needs.
Spousal coverage is also a good idea, particularly if your spouse is a stay-at-home parent. The benefit can be used to pay for things like help with child care and household maintenance, allowing you to keep up with the demands of your schedule — and maintain the income your family relies on.
For Dr. Smith and his wife Lisa,* CI insurance played a vital role in her recovery process. A full-time homemaker and mother to three school-aged children, Lisa's world was turned upside down when she discovered a lump in her breast at age 41. A biopsy confirmed a diagnosis of invasive ductal carcinoma. The good news was that the pathology report confirmed there was no cancer in the lymph nodes. Unfortunately, the size of her tumour required her to undergo a full mastectomy.
Within two weeks of diagnosis, Lisa underwent surgery. Afterwards, her oncologist recommended four cycles of chemotherapy, each taking place 21 days apart.
As an obstetrician and the primary income earner, Dr. Smith's unpredictable hours meant he could not take over full-time parenting duties. Lisa's CI insurance policy paid her the full $100,000 benefit, giving them the means to hire a full-time caregiver for eight months while Lisa underwent treatment and regained her strength. Also, some of the leftover funds allowed Dr. Smith to offset the negative impact of earning a lower income when he reduced his hours to help care for his wife.
Critical Illness insurance is designed to help you when you need it most. It provides a lump sum to help support you financially if you are diagnosed with, and suffer from, a serious illness or condition, such as heart disease, stroke or cancer. It can reduce the financial stress experienced by you and your family, enabling you to focus on your recovery.
If you have not already done so, now is the time to get Extended Health Care and Dental insurance to help reduce future out-of-pocket costs for routine and emergency care. The OMA plan gives you the flexibility to combine both health and dental coverage under one plan, or choose either one separately, according to your needs.
At this stage, it is also a good idea to review your Disability Income insurance and Professional Overhead Expense insurance to make sure you have the appropriate amount of coverage to meet your current lifestyle, level of income and expenses.
Insurance professionals recommend that you review your coverage at least once a year to make sure you have the right type and amount of protection for your current life stage.
As an OMA member, you have access to a wide range of easy and affordable solutions that will help you build a comprehensive, customized insurance protection plan for you and your family.
*For illustrative purposes, characters in the story and scenario are fictional.