As a CEO, you have worked years to climb the ranks to finally get to your current position. Your lifestyle and success of your company are continent on your ability to be able to get up each morning and conduct business. In a moment, it can all be lost with an injury or a serious illness.
That’s where individual and corporate disability insurance comes into play. Disability insurance is intended to replace your income if you become too sick or injured to work.
What corporate executives should look for when it comes to disability income protection:
1) Own occupation definition of disability. This means that if due to sickness or injury and you can’t work as an executive, the policy will pay you a monthly benefit even if you are able to work in another occupation.
2) Non cancelable, guaranteed renewable. This means that as long as you pay the premiums, the company can never cancel your coverage or modify your contract.
3) Discounts. If your company does not already have discounts, you can set them up if 2 or 3 people choose to purchase policies. Since these are individual policies and require medical underwriting, you can discriminate who purchases the policy. Meaning, you can choose to have the corporate officers only purchase policies and not be require to purchase policies on every employee.
4) Independent objective brokers. Since occupational classes vary widely from company to company, it is worthwhile working with an independent insurance broker who can compare all of the available options for you so you can ensure the most suitable policy at the best price.
5) Group disability insurance. You may consider implementing both a group and disability insurance policy. Group policies are intended to replace most income for rank and file employees. As such, there are typically large gaps for corporate executives.
6) Traditional companies will allow you to purchase up to $25,000/month of individual benefit. If your income is greater than $700k a year (approximately), you may also choose to purchase excess coverage on top of your individual coverage,