Disability insurance is purchased to protect your income in the event of a permanent or partial disability.  After all, your earning power is likely the most important asset that you have.  But what if you are not a salaried employee and a disability caused you to lose part of your customer base?  

A “Residual Benefit” is part of a disability insurance policy that pays you lost income to get you closer to your former level of earnings.  

Let’s take an example of Bob, an attorney earning $250,000 per year that recently had a broken back which forced him out of work for two years.  Bob’s largest client was paying him $50,000 per year, but when he became disabled, the client stopped paying Bob and began using a different attorney since Bob’s services weren’t available.  Now, two years later Bob is back at work, but can only earn $100,000 because he lost the large client and several others since he can only work 20 hours a week now. How does he make up for the lost $150,000 and his inability to work the 60+ hours per week he was working before?  With a residual benefit that pays him a partial benefit based on the lost income.

Most disability policies will only pay a recovery benefit for a short time period or pay a lump sum.  If you have a client base that could be lost in the event of a disability, make sure to purchase a policy with a residual / partial disability benefit payable for the full benefit period, up to the time that you regain your former income level.  Most disability insurance contracts that offer this benefit require a 20% loss of income and often a loss of time and/or duties, while our top carrier offers the following:

• Dollar-for-dollar replacement of lost income for the first 12 months, up to the monthly benefit
• Proportionate loss of income benefit beginning in month 13
• Benefits paid for up to the entire benefit period when there is a minimum 15% income loss as the result of the cause of your disability without any requirement for loss of time or duties

When shopping for disability insurance, make sure to purchase a policy that includes the most favorable contract terms.  To get a quote for a disability insurance policy, give us a call at 1-877-656-1436 from 9 AM to 9 PM eastern time or This e-mail address is being protected from spambots. You need JavaScript enabled to view it 24 hours a day.  You can also complete the short form below.  Due to the number of factors involved in quoting disability insurance, online instant quotes are not available.