As a new dentist, you have a lot on your mind. But you have a lot to protect, too. The investment you've made in yourself, along with the considerable debt you've accumulated, commands serious attention.
Insurance is one of those topics that most people prefer to avoid. But you can't afford to ignore the real-life importance of insurance as a way to safeguard your future in this profession. Whether it's your family, your income, or your practice at stake, having the right insurance can make all the difference. Take a few minutes now to learn about some simple and inexpensive ways to protect everything you've worked so hard to accomplish.
Want a tip from someone who has been in your shoes? Here are some bits of advice regarding insurance coverage for new dentists:
If you can't afford full coverage at first, at least get something in place while you are healthy. Then, apply for more coverage as your income increases.
Look at your disability policy at least every 3 to 5 years to see if the coverage is adequate as your income grows. If not, increase your insurance while you can. If I could qualify medically to buy more coverage today, I would be the first one in line.
Make sure you have personal income protection insurance, and separately, also have business overhead coverage. Dentists can't afford not to have disability insurance.
It is a smart move to get your insurance portfolio started while you are in dental school. When you get out of school, you may need to borrow money to buy a house and possibly equipment for your practice. The fact that you have insurance will show creditors that you are financially responsible.
How much is your future livelihood at risk? Perhaps more than you'd like to think. There's close to a 30% chance you'll become disabled at some point during your career as a dentist.1 Aside from the obvious physical and emotional trauma, a disability can be financially stressful too — impacting both your ability to earn an income and your ability to meet financial obligations. In fact, nearly half of all U.S. mortgage foreclosures are caused by disability2 — partly due to the fact that the average U.S. household has only two months of savings in reserve.3
Clean, safe living might help you beat the odds, but since disability doesn't discriminate — it can happen to any dentist, anywhere, at any time — that may not be a risk you're willing to take. The smart thing to do is to mitigate your risk... by purchasing insurance that can provide cash when you need it.
First, determine your liabilities — that is, the various obligations that make up your personal finances. Here are a few questions to ask:
Think for a moment what would happen to any of these obligations if you died or became disabled. They would not disappear just because you may no longer be able to pay the bills.
How much insurance do you need? Use our handy coverage calculators to quickly quantify your need for specific types of personal insurance. Simply input a few variables, and your estimated insurance need will appear instantly.
Is there a right time to buy certain types of insurance protection? Yes, there is — and this information can be especially helpful if you're trying to prioritize your needs.
This timeline identifies when the average dentist makes decisions regarding insurance and/or examines the need for specific types of coverage. Consult your financial advisor or contact us at 866-607-5338 or ada@gwl.com for suggestions that pertain to your unique needs and circumstances.
Certain life-changing events (paying off student loans, selling your practice, etc.) may even motivate you to decrease your insurance coverage. But before you reduce (or cancel) any policy, be very sure you no longer need that insurance. The need may be different from your need at the time you first got the coverage, yet just as important. (For instance, you may have originally bought life insurance as collateral for your practice loan, but now need that insurance to provide future income for a spouse and child.) It may be difficult, expensive, and/or impossible to replace insurance later, depending on your age or health. The key point to remember is that maintaining an adequate amount of insurance is important at all stages of your professional career.
Interested in more guidance and information? You have access to our extensive Resource Library of hands-on and educational publications, whether or not you're a participant in any ADA-sponsored insurance Plan. Request a complimentary planning kit, tutorial, reference guide, or outline — all available exclusively to ADA members. Indicate your selection(s) on our online request form so we can mail you the materials you'd like.
If you signed up for ADA-sponsored insurance while you were in dental school, you can easily keep it after you've graduated. In fact, the ADA structured its student insurance programs to specifically enable you to keep your coverage on an open-ended basis, as long as you need it throughout your career. So if you obtained this protection while you were a dental student, that means you're one step ahead!
Life insurance: As long as you pay renewal premiums when billed, your coverage can continue automatically; there is no conversion process required. Please remember to contact us with your current address so your renewal notice doesn't get lost or delayed. With your Plan's automatic renewal provision, there are no forms to complete, no conversion fees, nothing to interrupt your coverage in any way. (For the Term Life Plan, you are eligible for Post-Doctorate Discounts that significantly reduce the cost of your insurance during your first three years after graduation. Only dentists who signed up for life insurance during dental school and maintained continuous coverage are eligible for Post-Doctorate Discounts.) If you need greater protection, either for loan collateral or to better safeguard your family, you can apply for more life insurance at any time before age 65.
Disability insurance: To convert your coverage from the Student Disability Insurance Plan to the Income Protection Plan, simply complete a conversion application. You will receive the same amount of monthly disability coverage you had as a student, without any conversion fee, medical exam, or financial proof of insurability required. You are eligible for conversion as long as you work a minimum of 20 hours per week, are an active ADA member, and submit your conversion application by December 31 of the year you complete your studies. Note: If you are enrolled in a post-doc residency program and maintain your student membership status, your student coverage will still protect you until you are employed as a dentist. And you may convert to the ADA Income Protection Plan even if you are not a clinical dentist but instead pursue an occupation as a dental researcher or consultant, or as dental school faculty.
When it comes to insurance, there's a lot to think about. That's why it's important to find someone you can trust — someone who will really look out for your best interests, who'll teach you the lingo and guide you through the process. An ADA Plan Specialist can help you understand the importance and value of many different types of insurance, demonstrate ways to make coverage more customized or more affordable, walk you through the many practical ways to use insurance in everyday life, and even give you objective assistance while you compare policies. Contact us at 866-607-5338 or ada@gwl.com when you're ready to dig into this new frontier.
1 Statistic based on the disability claims of ADA members covered by Great-West Life.
2 The Truth About Money, 3rd Edition, 2004.
3 Disability_Insurance_Center.com, 2005.