Insurance can be a confusing industry, especially for young adults who have little to no experience with it. For one, it’s full of jargon that the average person doesn’t understand. What’s more, the number of products on the market is enough to make your head spin.
Rather than taking the time to sort through its intricacies, it may be tempting to ignore insurance all together. Resist this temptation—whether you’re nearing the end of your orthodontic residency or you’re just starting your career, having the right types of insurance in place can set you up for long-term success.
So how do you know which types of coverage you need? That answer will differ depending on your unique situation; however, there are certain types of insurance that nearly every orthodontist should have in place soon after their career begins. To help, we have compiled the following list of must-have insurance coverage, all of which are available to AAO members through its endorsed insurance products.
Must-Have Insurance #1: Disability Insurance
Disability insurance protects your most important asset—your paycheck. If you’re too ill or injured to work, it provides you with supplementary income to help you pay for daily living expenses.
It may be tempting to believe that becoming disabled is too rare to justify coverage. But consider this: one in four 20-year-olds will suffer from a disability before they retire.1
If you’re concerned about cost, don’t be. AAO members under age 35 can receive $1,000 in monthly disability income insurance benefits for under $15 per month. That’s less than the cost of most gym memberships!
Must-Have Insurance #2: Life Insurance
Life insurance helps provide financial support to your loved ones if you die. If you’re married and/or have children, life insurance is a must. Without your income to depend on, your spouse and children may have a difficult time maintaining their quality of life.
But even before you marry and start a family, life insurance can be necessary. If you’re like most orthodontic graduates, you likely have (or will have) debts well into the six-figure range. If you have a cosigner on your loan, that person would be responsible for paying off the remainder of your debt if you die. Life insurance can help cover those debts so your loved ones don’t have to.
AAO members have two excellent options for life insurance products: term life and level term life. A group term life insurance policy can be very affordable early on; however, each year, your premium will increase—gradually at first, and then more rapidly as you get older. With group level
term life insurance, your rates will remain level for the entire 10- or 20-year term of your policy. The best option for you will depend on your specific circumstances, but one fact remains true for each product: the younger you are, the cheaper your coverage will be.
Must-Have Insurance #3: Malpractice Insurance
Being sued for malpractice is a risk that every orthodontist faces—whether fresh out of school or an industry veteran. No matter how meticulous you are in your work, all it takes is one dissatisfied patient to file a claim.
To avoid hefty legal bills and a compromised reputation, malpractice insurance is a must. And as an AAO member, you may qualify for discounts of 75% or more2
available to recent graduates, or a 25% discount to first-time buyers.3
Completing Your Insurance Portfolio
Disability insurance, life insurance, and malpractice insurance are critical coverages for every orthodontist, no matter what your personal circumstances may be. But depending on your situation, you may need to consider other products as well.
For example, if you own an orthodontic practice (or aspire to someday), you’ll require business insurance products like a business owners’ policy.
Facing the Facts
As a young professional, insurance might feel like something to be dealt with later. But unfortunate events happen no matter what your age. Enlisting the help of insurance products, like those offered through the AAO-Endorsed Insurance Program, will provide you with peace of mind that you, your loved ones, and your assets will be protected…no matter what.
This article is brought to you by the Pearl Insurance Company, AAO’s endorsed insurance administrator. For more information on AAO-endorsed insurance products, visit www.aaoi-insurance.com. For information about malpractice insurance coverage offered through the AAO Insurance Company (AAOIC), visit www.aaoic.com.
1"Facts from LIMRA: 2015 Disability Insurance Awareness Month." LIMRA. LIMRA, 2015. Web. 18 Oct. 2016.
2Provided this policy is purchased as your first coverage upon graduation. To receive an additional 10% off your premium, you must participate in the current risk management program.
3Cannot be combined with other offers.