I was diagnosed with breast cancer 12 months ago. I never thought……”this” would ever happen to me!!! Funnily enough the rest of humankind thinks very similarly, but it has to happen to someone, right! Did you know that every working Australian has a one in three chance of becoming disabled for more than three months before they reach 65 years of age? Do you have contingencies in place for any such “unplanned event/s“, especially if you run your own business? No I don’t work for an insurance company and I’m not touting for insurance premium business ……..BUT I would like to talk about something that I believe is an “essential” for business owners, even if you are in a ‘start up‘ phase when income is fluctuating and unpredictable.
I have been back in chambers for close to 2 months after being away almost 11 months, due to undergoing surgeries, chemo and radiation. How did I survive financially as a ‘relatively new‘ small business owner whose business was in ‘growth stage’.
What about my income stream as a sole practitioner? I had spoken with a senior female Barrister in my first year at the Bar and she strongly encouraged me to have income protection insurance. This was not really on the top of my list when my income and payments were fluctuating. However, I took her advice and chose an income protection policy. I am so grateful for that advice!!!
When I was diagnosed and had a long treatment road ahead, having income protection insurance took away the stress of how I was going to financially survive, which was invaluable. Its expensive to be sick!! However, I did not insure myself adequately enough, which I had been earlier advised to do by another senior male barrister. I didn’t feel I was in a position to pay for more than the ‘basic‘ premiums! In hindsight, it was false reasoning. I write this to assist others so they can learn from my story!
On the flip side of the coin, I have a friend who was diagnosed with breast cancer 2 days after me who didn’t have income protection insurance and she was in her own business building phase, with a child and a mortgage. She had to return to work to service her existing clients, without taking on any new clients for quite an extensive period of time, even though her health was poor. She had no choice!
I suggest, you need to consider the following, from a practical perspective, to ensure you and your business survive if there is an “unexpected, unplanned event” (whatever that is) and you can’t work:
- Review how long any income protection insurance pays income i.e. 12 months or more?
- Ask: How long do I have to be off work before I can claim i.e. 1 week or more?
- Ask: How often can I claim i.e. weekly, fortnightly, monthly?
- Ask: If the Doctor provides a doctors certificate for X months will the insurer pay X months, in advance, or will a claim need to be made each week, fortnight, month in arrears?
- Do I need to have other insurance if the income protection only pays income for say 12 months, in the event of a permanent disability or a lengthier illness?
- Do I need to have trauma insurance which pays out a lump sum under specified “unplanned, unexpected‘ events?
My advice to you, as a small business owner, who had an “unplanned event‘, who was inadequately insured …….
- seriously consider your insurance needs NOW
- pay the necessary insurance premiums for your needs, even if your income is unpredictable or you may be in a business building phase.
If you are one of the one in three Australians who are disabled for longer than 3 months prior to 65 years of age, this advice will ensure much less stress as you have the time to concentrate on your eventual return to work.
I write a blog on diverse topics at http://sydneybarrister.net.au which I invite you to subscribe to.