Planning for this potential risk is critical for corporate executives. 

  • As a corporate executive, the amount of your future earnings can be negatively impacted if you become disabled through illness or injury.
  • When considering the effects of a disability, you should first examine what existing coverage you have in place through your executive compensation program.
  • It’s extremely important to identify the risks you face from a disability, and establish a plan to reduce this potentially devastating situation. 

As a corporate executive, you have the prospect of earning a significant amount of money during your working career through what is likely a robust executive compensation program. This amount of future earnings can be negatively impacted if you become disabled through illness or injury. Studies show that the likelihood of disability during a working career is higher than the likelihood of death. According to 2004 statistics from Health Insurance America, approximately 30% of all people aged 35 to 65 will suffer a disability for at least 90 days, and about one in seven can expect to become disabled for five years or more. It’s imperative to examine the type of disability benefits you have as an executive and confirm that your income is adequately protected.  

Assessing your coverage

When considering the effects of a disability, you should first examine what existing coverage you have in place through your executive compensation program. There are two distinct types of employer provided plans that can provide income protection: short-term and long-term coverage. 

Please see important disclosures at the end of the article.

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