What will happen to your business if you become disabled?
The Life and Health Insurance Foundation for Education (LIFE) recently released some interesting statistics on disability. LIFE commissioned a study to analyze disability trends in the United States. In looking at the results, LIFE points out that it’s important to keep in mind that this study examines the individually insured population, which is more affluent and healthier than the population at large. What that means is that the risk of disability is even higher among the general population, a finding supported in other research studies.
Some key points:
• The probability of a white-collar worker becoming disabled for at least 90 days between the ages of 35 and 65 is 27% for men and 31% for women, compared to 29% for men and 34% for women in the 1970s and 1980s.
• A 35-year-old male whose job involves hazardous work with heavy manual labor has a 51% chance of becoming disabled for at least 90 days between the ages of 35 and 65. A 35-year-old male in a skilled clerical or skilled technical position has a 33% chance of becoming disabled for at least 90 days between the ages of 35 and 65.
What will happen to your real estate investing business if you are unable to run it for a few weeks, a few months, or longer? Who will manage your properties and take care of administrative tasks?
There are two key points to consider: 1) Who will do the work you can’t do? And 2) How will you cover the costs associated with hiring someone to do your work and replace lost revenue?
Putting together a plan that addresses who will actually perform the tasks you do will depend on the size of your operation and your particular resources. This is something you should discuss with your business associates and family members.
Covering the costs can be addressed at least in part through disability insurance. Talk to your insurance agent about your various options for disability coverage, including policies that pay you personally, policies that pay your company, and even policies that will pay your business overhead costs if you (as the owner) are unable to work in your business.
Don’t let an accident or illness wipe out everything you’ve worked hard to accomplish.
Jackie
