We ve got you covered! Short and Long Term Disability from the AVMA GHLIT

We ve got you covered! Short and Long Term Disability from the AVMA GHLIT

Today s Purpose, Process, Payoff The purpose of today s presentation is to understand why the AVMA GHLIT offers disability insurance to veterinarians, and what it can mean for you and your family. The process is to gain an understanding of the risks of long term disability both financially and personally. The payoff is by the end of this meeting, you will understand what short and long term disability insurance do, and whether or not it is something that you should review with your authorized AVMA GHLIT representative.

What are the Risks? For a 32 year-old, a serious disability of 90 days or longer is 6 1/2 times more likely than death (Disability Insurance Resource Center)

50% of consumers have 3 months or less of their living expenses saved (Guardian Insurance & Behavior Study, 2001) 1 of 7 employees will be disabled for 5 years or more before retirement (Commissioner s Disability Table, 1998)

What causes a disability? According to the Council for Disability Awareness 2013 Long Term Disability Claims Review, the following were the leading causes of new disability claims in 2012: 1. Musculoskeletal/connective tissue disorders (28.5%)* 2. Cancer (14.6%) 3. Injuries and poisoning (10.6%) 4. Mental disorders (8.9%) 5. Cardiovascular/circulatory disorder (8.2%) Approximately 90% of claims are caused by illnesses rather than accidents which means they are not covered by workers comp *this category includes claims caused by neck and back pain: joint, muscle and tendon disorders, foot, ankle and hand disorders, etc.

Losing Income Losing Ability Additional risks due to occupation Physical Hazards caused by animals, medical equip or general work conditions Ergonomic-related: lifting and awkward postures Chemical Hazards: anesthetics, drugs, latex, agricultural dust/mold spores Disease-causing pathogens: transmitted by needle sticks, inhalation, exposure to waste. Risk from assisting injured coworker (blood borne).

What are we protecting? Mean value of full-time starting salaries (not including advanced study) was: $66,649 For 47.8% of the respondents above, this included additional compensation (i.e. signing bonus, moving allowance, production bonus, etc) *Source: calculated from JAVMA, Vol 235, No. 7, October 1, 2009 p830

Potential earnings to age 65* Age $50,000 $75,000 $100,000 $150,000 $200,000 $250,000 30 $3,023,104 $4,534,656 $6,046,208 $9,069,312 $12,092,416 $15,115,520 35 $2,378,771 $3,568,156 $4,757,541 $7,136,312 $9,515,083 $11,893,853 40 $1,882,963 $2,734,444 $3,645,926 $5,468,889 $7,291,852 $9,114,816 45 $1,343,519 $2,015,278 $2,687,037 $4,030,556 $5,374,074 $6,717,593 50 $929,946 $1,394,918 $1,859,891 $2,789,837 $3,719,782 $4,649,728 55 $573,194 $859,790 $1,146,387 $1,719,581 $2,292,775 $2,865,969 *Assumes 3% annual increases

According to the AVMA - Approximately 89.9% of 2010 grads stated they have debt Mean value for those claiming to have debt have..$133,873 36.7% of those with debt had $150,000 or more to pay back *Source: JAVMA, Vol 237, No. 7, October 1, 2010 p798

Case Study:* What happens when someone becomes disabled? Dr. Jane, age 35 Went skiing last weekend and broke her wrist As a recent graduate she has student loans, rent, a car payment and credit cards to pay each month. Her monthly expenses run about $6,000. She has $12,000 in savings, which she is saving to buy her first house. Her Orthopedic surgeon says that it will take about 3 months to get back to normal if everything goes right, and she might not be able to go back to work full time right away! * Hypothetical example

Discussion What should Dr. Jane consider first? Does she have enough savings?

Credit Cards?? Loans?? Social Security Disability? Workers Comp? Accident Policy Employer will just help me out? Call Mom and Dad?!?

Short Term Disability coverage Short term disability coverage can replace part of your income if you are unable to work due to a covered disability. Benefits are available between $200 and $5000 monthly The AVMA GHLIT offers two plans 1 day accident/ 8 day sickness payable to 180 days 30 day elimination payable to 180 days

Maternity Benefits under short term disability Up to 90 days of maternity benefits for normal childbirth as prescribed by attending physician s certification pre- and post delivery* Disabilities resulting from complications due to pregnancy are not subject to these limitations Can be combined with our Hospital Indemnity coverage for additional benefits. Pregnancy is covered up to $400 per day during hospitalization.* Complicated pregnancies are covered immediately. Newborn dependents are eligible for benefits at birth (must send written notification within 30 days). *The maximum benefit period for such a disability will be no more than 3 months. There is a pre-existing condition limitation in the policy. The physician needs to complete the medical provider s statement and the member needs to be under the regular care of a physician. Benefits will not be paid for a pre-existing pregnancy until the end of 9 consecutive months during which the member has been insured under the short term disability income coverage.

Losing your earning power can: Create more debt Deplete savings entirely Force you/your family to change lifestyles

What helps preserve your paycheck? Long Term Disability Insurance Age Provides a monthly check if you are out of work due to a covered disability. Max. monthly benefit available is based on age and earnings from the previous year equal to 60% or 70% of yearly income. Some employers offer group disability insurance Individual or some association group Disability plans are PORTABLE (unlike group employer insurance),000 $

Case study: Dr. John* Dr. John has been having numbness in his right hand, and is having difficulty with surgery. Upon diagnosis from his doctor, he finds out that it is caused by a neurological disorder, and his condition will not improve, and it will deteriorate over time. Dr. John stops operating on patients immediately, and with help can still do exams. Within 6 months, his condition has worsened, and he can no longer work as a veterinarian. Dr. John owns his practice with his partner Dr. Beth. They have a business loan of $1million, and some other equipment loans. They have 3 full time associates and 10 other staff people. Dr. John is the primary earner for his family. His wife Susie is a stay at home mom, raising their 4 children ages 2-14. She hasn t worked in 14 years, and it would be hard for her to re-enter the workforce. Dr. John could absolutely go and get another job, he just couldn t work as a veterinarian due to his hands not being steady. They do not live near a veterinary college. * Hypothetical example

Let us help you! www.avmaghlit.org You have a lot to protect! Call the AVMA GHLIT at 800.621.6360 Or contact your local AVMA GHLIT Authorized Representative

Case Study: Dr. John What are things that Dr. John should consider? Would he be covered by Social Security? Workers Comp?

Long Term Disability Insurance from the AVMA GHLIT Coverage available from $1,000 monthly to $10,000 monthly (if purchased before age 50) Waiting Period Options: 30 Day Waiting Period 90 Day Waiting Period 180 Day Waiting Period Residual Benefits are payable if you are able to return to work at a reduced income due to your disability.

Long Term Disability Riders/Options* Own Occupation Plus Benefit- allows you to receive full benefits if you are unable to perform the duties of your own occupation and there is a loss of at least 25% of pre-disability earnings. Cost of Living Adjustment- helps protect you from the increased costs while disabled due inflation. Benefits adjust up to 8% on each anniversary date based on the consumer price index. Future Purchase Option- allows you to increase your disability coverage at a future date without medical underwriting. Options are available from $500 to $4,000 in monthly benefits. Basic Protection Plan- Over 70% of the GHLIT Disability policy holders purchase this rider for additional life and AD&D protection as well as a $600 Rabies Prophylaxis benefit with titer coverage. * Available at an additional cost.

Why AVMA GHLIT? Your membership benefit of the AVMA Products tailor-made for you by a board of trustees of experienced veterinarians Provides group purchasing power of thousands of veterinarians across the nation Over 32,000 veterinarians and students are currently insured with the Trust

Plans underwritten by New York Life Insurance Company (NY, NY 10010) on Group Policy G-14884/14885/14886/Face Policy Form GMR. All plans may not be available in all states.