Don't kill your life insurance policyCertain factors can invalidate a life insurance policy. Protect your heirs by taking these steps.Shopping for a health insurance planGetting the right health insurance policy can make a big difference to your financial health.Keep kids covered with health insuranceMany children are unnecessarily uninsured. Health insurance can be cheap, even free for some families.Life insurance needs vary with lifestyleWhether or not you need life insurance depends on your age, family structure and financial situation.A mini-primer on permanent life insurancePermanent insurance is more far complicated and expensive than term. Here's a rundown on the different types.
Maintenance and Janitorial Services
- Depreciation
- Interest on Business Debts
- Office Supplies
- Other Fixed Expenses that are Ordinary, Necessary, and Tax Deductible
Some policies even cover the salary of a temporary employee hired to do the duties of the disabled. Income taxes, the cost of inventory, and the cost of furniture are a few expenses that are not covered.
There are several key areas in which BOE insurance differs from personal disability insurance.
Benefit Periods – Usually, BOE insurance policies have short benefit periods that do not exceed two years. Remember that BOE insurance is not protecting your ability to generate income—that is what a personal disability policy does. Instead, BOE insurance allows you to keep your practice open, or at least pay for its expenses until you recover. In the case of a long-term disability, it offers you up to two years to make a business decision, such as whether to shut down or liquidate your practice, without worrying about accruing debt from business expenses.
Maximum Benefits – Personal disability insurance pays a monthly benefit as defined in the policy. BOE insurance policies offer a maximum monthly benefit, but only pay the actual overhead expenses if they are less than the maximum benefit. For example, if the maximum monthly benefit is $1,000 but actual business overhead expenses are only $600, the benefit paid is $600. With some insurers, that unused $400 benefit can be applied to increase future monthly maximums or to extend the benefit period.
Taxation – As long as premiums for personal disability insurance are paid with after-tax dollars, the benefits are tax free. DOE insurance benefits are subject to income tax, but the premiums are tax deductible as a business expense.
One similarity that BOE insurance and personal disability insurance policies share is that the sooner you purchase a policy, the better. Not only will you get lower rates when you are younger and generally in better health, but additional coverage can be purchased later without providing further evidence of medical insurability.
BOE insurance is a great idea for small practices with several physicians. If one physician is disabled, their portion of business overhead expenses will be covered by the policy so the other physicians are still able to practice without an extra financial burden.
Your practice should allow you to earn income, not be a financial parasite if you become disabled. BOE insurance doesn’t just protect your practice… it protects you.
Article Source: http://activeauthors.com
Andy Puls is a freelance writer for Doctor Disability Insurance
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