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August 14th, 2017
As a medical doctor, you can reduce your risk exposure by taking out appropriate personal and practice insurance. Personal insurance like income protection, life and disability, and trauma products can protect you against unexpected events. Public liability and medical indemnity insurance shields you and/or your practice against professional risks. Knowing when to review your insurance products is as important as choosing the right products for you.
You’ll want to review your products at least once a year and whenever your practice or personal situations undergo a significant change in circumstances. It’s worth remembering when entering a new insurance product agreement you should check your policy to make sure it offers you the full range of situations you need to be covered for. Along with reviewing your insurance products at least once a year, you can also ensure you’re getting appropriate coverage by checking you’re adequately covered when trigger events occur.
One type of significant change in your circumstance is any changes to your income level. As you earn more money, you’ll want to make sure your income protection and disability products will cover you for the lifestyle you’d like to maintain if something unexpected happens. Similarly, as you get closer to your retirement years and wind back on work, you might decide to reduce your level of cover accordingly.
Any lifestyle changes affecting your risk levels could warrant a review of your coverage. For example, if you’ve quit smoking, you’ll want to update your policies to reflect your lower risk level so you pay non-smoker rates.
If your original policy was finalised with a medical loading or exclusion and your health has improved, you can update your policy to possibly pay less in premiums and get broader coverage. For example, you might have healed from a serious knee injury or lost weight.
A major change in your family situation warrants a policy update for your personal insurance. For example, you might have married or welcomed a baby to your household. You’ll want to obtain coverage to ensure your baby is covered and ensure your beneficiary list is up to date. If you lose a loved one, have a sick family member, or have children leaving the house, you should also make time to review and update your insurance policies.
Another triggering factor for reviewing your insurance is a major change in your financial situation. For example, you might have significantly reduced or increased your debt levels by paying off your mortgage or getting a mortgage. Generally, the less debt you have, the lower your premiums for personal insurance products as you’re considered less risky. If you’ve taken on a new mortgage, you’ll probably want to obtain more income insurance to ensure you can still make your repayments in case something unexpected happens.
Other possible changes in your finances could include receiving an inheritance or windfall, expanding your business, or winding down your practice. Changes in financial situations could have you rethinking how much you want your beneficiaries to receive, considering getting more coverage, or buying other types of coverage.
Whether you’re changing employers, setting up your own practice, or selling your practice and going part-time, you should check your insurance policies to make sure they match your new requirements.
For example, if you’re setting up your own practice or buying into a practice, you’ll want to obtain public liability, practice-level medical indemnity insurance, and perhaps business property insurance. Hiring your own staff means you’ll need to have workers’ compensation.
If you buy your own site for a practice and lease out part of it, you might need to have landlord insurance. If you’re returning to work for someone else, you won’t need to have public liability insurance.
A change in qualification level can also be a trigger event. If you’re completing your specialist training, you’ll probably be earning more. You’ll want to check your income protection insurance is adequate for your new income level.
Any time you feel your premiums are getting too high is a good time to review. Take time to shop around and compare insurance quotes. Look for a competitive package. Try to negotiate with insurers for discounts. For example, they might offer a cheaper premium if you purchase all your personal and professional insurance from them.
Make a time once a year to review your insurance products, and remember to review throughout the year if you experience a significant change in circumstances. This way, you can ensure your family and your practice are well protected against risks and unexpected events in life.
MEDIQ Financial offers expert services to doctors throughout the entire financial life cycle. Whether you’re an employee doctor or run your own medical practice, we can guide you with trusted accounting, investment, and financial advice and help you achieve your wealth-building goals. Contact us today for advice on ensuring your insurance cover fits in with your overall financial strategy.