Why You Need Disability Insurance: A Doctor’s Story

Stuart E. Lowenkron, MD
Associate, Physician Financial Services

Members of the medical profession sacrifice their time and energy without reservation for the care of patients. All too often, however, it is done to the detriment of themselves and their families—especially in the areas of personal financial planning. Many physicians opine the cost of the various insurance policies we purchase, whether life insurance, homeowners insurance, or disability insurance. We forget, as I almost did, that we need these policies to protect our most valuable asset: our ability to earn an income.

Early Career

In the early 1990s, I was completing my fellowship. The future seemed bright, and it was time to take the first steps toward short-term and long-term planning for my family. At that early stage of my career, I thought there would be plenty of time to take care of these things. Since I was still relatively young and in good health, I wanted to concentrate on the present, and the future would take care of itself. At the urging of my personal and financial advisors, however, I purchased life insurance and disabil­ity insurance, and began putting money into tax-deferred accounts for the future. Unbeknownst to me, taking these steps, or more specifically, purchasing my disability insurance policy, would be among the most important and smartest decisions I would ever make.

Upon completion of my residency and fellowship training, I uprooted my young family to a small Southern town, where I had been recruited to set up shop as a specialist. Within 3 years, I had a thriving practice and started to build a comfortable lifestyle for myself and my family. Two years later, though, it was gone: my home, my family as a result of divorce, my practice, my money, and my friends. The primary reason was my health. I had begun to suffer from major depression, a disease that would follow me and impact the rest of my life.

The Impact of Depression

For me, depression has manifested in a number of ways, including profound sadness and severe fatigue, often with an inability to get out of bed. Difficulty concentrating would result in mental paralysis, often impairing my ability to perform even the simplest of tasks. Taking care of patients always seemed to be the easy part of my job, but dealing with my depression and taking care of myself was a different story. I have been battling this disease a good part of my life, have been in and out of treatment and taking medication since I was in my 20s, and it has been an exhausting mental and physical endeavor.

The most significant of all the problems at the onset of the disease and at points throughout my medical career was an inability to work, with subsequent loss of income and the inability to support and care for myself and my family. In my third year of private practice, my health deteriorated significantly. I finally reached a point where I became overwhelmed and “paralyzed”; I was unable to work, and eventually I had to give up my practice. All of a sudden I had no income and an overwhelming number of problems, and I was barely able to function due to serious depression.

The Silver Lining

Despite these problems, I had 2 things going for me that essentially saved me. First, when I bought my disability and life insurance policies, I began a relationship with the agent who sold them to me that has lasted more than 20 years. He did not just sell me a policy and disappear. He kept in touch with me to see how things were going and whether there was anything else he could help me with; he ultimately became a loyal friend. In fact, it was he who reminded me about the second thing I had going for me: the disability insurance policy that I had not wanted to purchase several years before.

The insurance policies that I complained about having to purchase, believing I was probably never going to need them, became of utmost importance. Like most physicians who deal with disabled patients, I found it hard to believe that I had become one of them. The monthly income from my disability insurance policy saved my life.

After a few years, I felt I was ready to return to work. I would need to return to employment as a new employee of either a hospital or someone’s private practice. How would I make it work financially? I was residing in an area with a higher cost of living; I had remarried and was granted custody of my children. I also needed to purchase a home. It appeared that if I wanted to continue to live where I was, I was going to have to work for a lot less money than I had been earning previously.

With income from my disability insurance policy, I was able to do this once again. It contained a rider that would pay benefits, proportionate to my loss of income, even though I was still working in my original field (see related article on this page). Although I believed I was no longer sick, my income was. With a little lifestyle adjustment, the salary I would earn plus the supplemental income I received from my disability policy allowed me to take a job at a hospital, followed by a move back into private practice. Both paid well below what I needed, but I was able to support my family until my salary increased to something more in line with my cost of living.

A New Beginning

Unfortunately, after working full-time for 6 more years, I once again became too sick to work and had to claim total disability. After about a year and a half, and much discussion with family, friends, and medical professionals, I made a life-changing decision: I changed professions. Although I would always be a doctor, my medical condition would no longer allow me to actively practice clinical medicine, and I changed course to something that would provide a more favorable work environment.

I now devote my time and energy, using my experience, to make sure physicians and other healthcare professionals have the same type of income protection in place. Life has taught me a valuable lesson. Unfortunately, in the medical profession, we are too busy or do not realize that taking steps early in our career can help us avoid mistakes that can be financially devastating. Thankfully, my disability insurance policy contained a valuable “own occupation” definition of total disability that allows me to continue to receive monthly income until age 65 years, regardless of my ability to work in another profession. In addition, my benefits also increase annually due to the cost of living rider that I purchased.

I am now, once again, able to provide for my family while working in a profession more conducive to my medical issues. Without my disability policy, which I did not want to buy and cursed every time I paid a premium, I do not know how my family and I would have survived. I am so glad I never had to find out.

Stuart E. Lowenkron, MD, is an associate of Physician Financial Services, a New York–based firm specializing in income protection and wealth accumulation strategies for physicians. He can be reached at 800-481-6447 or by email to Slowenkronmd@physicianfinancial services.com with comments or questions.

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