Professionals like physicians, attorneys, consultants, and executives often believe they’re well-insured. They have employer benefits, solid savings, and sometimes even life insurance in place. But there’s one vulnerability that still lurks in many of their financial plans: the disability income gap.

Despite earning higher-than-average incomes, many professionals are under-protected when it comes to their ability to earn. And in a career-ending disability scenario, the financial fallout can be devastating.

What Is the Disability Income Gap?

The disability income gap is the difference between what a client earns and what they would receive if they became disabled. For professionals relying on employer-sponsored group disability insurance, this gap is often wider than they realize.

Consider:

• Group LTD typically covers only 60% of base salary

• Benefits are usually taxable if the employer pays the premium

• Bonuses, commissions, and incentive comp are often excluded

• Caps limit benefits for high earners, sometimes to $5,000 or $10,000/month—regardless of income

For a professional making $250,000 a year, group coverage might only replace $60,000–$75,000 of net income annually. That’s a dramatic lifestyle change—and a massive gap.

Why High Earners Are at Greater Risk

High-income professionals often have bigger financial commitments: mortgages, student loans, children’s education, and lifestyle expenses. But unlike lower earners, they may not qualify for social security disability income (SSDI) because their total disability definition is stricter, and their employer plans have hard limits.

When income stops, fixed expenses don’t.

How Individual Disability Insurance Bridges the Gap

An individual disability insurance policy is the most effective way to close this income gap. Here’s why:

• Customizable Coverage: Clients can insure a larger percentage of their true income, including bonuses and commissions.

• Tax-Free Benefits: If premiums are paid with after-tax dollars, benefits are tax-free.

• Own-Occupation Protection: Especially important for specialists like surgeons, dentists, or attorneys—policies can protect them even if they’re able to work in a different field.

• Portability: Unlike group plans, individual DI stays with the client even if they change jobs.

Talking Points for Advisors

When speaking with clients or prospects, use questions like:

• “Do you know how much of your income your group disability plan actually covers?”

• “What percentage of your income would you need to maintain your lifestyle if you couldn’t work?”

• “Would your current plan cover your bonus or incentive comp?”

These open the door to education—and often, concern that leads to action.

Success in Action: A Quick Case Study

A 38-year-old sales executive earning $180,000 annually assumed she was covered through her company’s group LTD. After reviewing her policy, her advisor found the cap would limit her benefit to $6,000/month—about 40% of her take-home pay. She secured an individual DI policy that added another $4,000/month in benefits, tax-free. Now she has peace of mind—and her advisor has deepened the relationship.

Final Thoughts

For high-income professionals, the disability income gap isn’t just a potential inconvenience—it’s a threat to everything they’ve worked for. By proactively offering individual disability insurance, you’re not just selling a policy—you’re protecting a lifestyle, a family, and a future.

As their trusted advisor, it’s your job to make sure no gap goes unnoticed—and no income goes unprotected.

Learn more about covering the disability gap for high earners, contact Steve Crowe at ext. 222 or request a quote.