By John C. Cranham, DDS 

Even today, after decades into family life, dental practice, and continuing dental education, I sit down every January to outline my BHAGs (Big Hairy Audacious Goals) for the year. I block out the first Monday after Christmas to do this, but for the previous month, I’ve been thinking about what new goals will excite me most. I commonly do this type of thinking while I am exercising and driving.  

It’s during these alone times that I can intentionally mull over the things I could do next. I pay close attention to which possibilities excite me most. Oftentimes, these are goals that I feel will benefit others. 

Successful people have the ability to create daily behaviors that direct themselves towards their goals and take them forward on steppingstones. One of the simplest, yet powerful things I witnessed Dr. Pete Dawson do is how he started each day. He would go to his desk and spend 15 to 20 minutes writing six things on a 3×5 card. These weren’t a To Do list. These were six things that would direct him toward his next BHAG. He would place the card in his breast pocket. He did this day in and day out. 

Two weeks before he passed, Pete came to my lake house on oxygen. When he arrived, I had to help him out of the car and into the house on his walker. I looked at his shirt pocket, and there it was, the 3×5 card.  

We don’t have to use 3×5 cards to make notes for ourselves. We can use our phones. But it is powerful to reflect daily on steps that will take us in the direction we want to go and record those steps to lock them in our memory.  

In dentistry, we need to carve out habitual time to think about our goals and steppingstones. We need to carve out time to take the identified steps. The point is to have a system in place where you are thinking about it every day, because there is so much coming at us all day long that we are at risk of drowning in the noise.  

When we get caught up in the mundane, life is less interesting and less fulfilling. At least that has been my experience. When you sense you are becoming bored, you might just need to identify the next big goal that excites you. The challenge of getting there will bring you back to full life. 

By Edwin “Mac” McDonald DDS  

Change isn’t just about external circumstances; it’s also an inner evolution. We go on a transformative journey, and our reflections as we go touch upon our intention and legacy, our personal identity amidst the change, and decisions we make as the change unfolds.  

Challenge 1: Intention and Legacy 

When facing change, having a clear intention is like setting the compass for your journey. What legacy do you aspire to leave behind? Aligning your actions with your deeply held beliefs ensures congruence between your intentions and outcomes. But stress may cause you to move away from your most deeply held beliefs. I’ve witnessed this happen, just as I’ve witnessed deeply held beliefs guide what happens. 

Challenge 2: Personal Identity Amidst Change 

The question “Who do I want to be during this transition?” is profound. It invites introspection. Consider how you want to show up for yourself and those around you, especially those who are most important to you. Authenticity matters. 

Challenge 3: Listening and Accountability 

Change often involves decisions. Whose voices matter? Listening deeply to trusted individuals—those who respect and understand you—can provide valuable perspectives. Forming a leadership team of diverse viewpoints helps guide you toward success. 

The Importance of Values During Dental Practice Mergers and Acquisitions 

Many private dental practices are being acquired by large partnerships in 2024. These transitions have tons of potential and profit associated with them. Associated with these transitions are complex changes for the practice owner and team members…expanded ownership, more complex organizational structure, new operational systems, and a distancing of some decision making. They also come with the unknown of who will be your future partners after the next sale of the organization. Are you prepared for all of that?  

Preparing yourself and your team is essential. On the front end, asking every possible question including questions about the partnership’s core values, how they are integrated into the day-to-day operations, and communicating the importance of that to you and your team is essential to long term success. These questions and expressions are an attempt to examine the congruence and compatibility between you, your team, and your new partners. 

I am witnessing several friends transition successfully to one of these new partnerships. The common factor I observe is that each dentist has great self-awareness and received very strong assurance that they would retain autonomy to continue to practice according to the most deeply rooted values. I also observed that the large partnership was very stable with excellent systems and had high quality leadership.  

My father often told me: “The person that you have an agreement with is more important than the agreement itself.” In other words, a person of strong character will find a way to honor the intent of the agreement regardless of the specific circumstances of the moment. Values have longevity. Circumstances come and go. 

I have also witnessed an abandonment of strongly held values as an organization was going through the painful changes of decline. In abandoning their values, stakeholders were hurt and distanced themselves. It intensified and accelerated the decline. Values matter. Character counts. Clinging to our core values in times of change or decline will increase and accelerate recovery. There are countless Fortune 500 case studies to support this idea. 

Another Example of Values in Transition from My Life 

Finally, I want to leave you with a case study from my church, The Village Church. We had become a multi-site church in response to the demand of many people attending our main campus. As it grew, our leadership became painfully aware that it was not fulfilling our mission and it was not consistent with our closely held values of community and individual relationships. Over a period of several years, each church was given the opportunity to vote on becoming independent. They all voted around 95% in favor of the change. We gave away around 40 million dollars of real estate, equipment, furniture, and other assets to all of the churches.  

Today, the new independent churches are thriving as is our main campus where we attend. The decision was in conflict with everything that is happening in our business and church worlds where there is constant consolidation and scaling. However, the decision was consistent with the values that drive the purpose of the church. The change created multiple thriving churches that are serving their specific communities and growing people and their impact on our world. 

By Barry F. Polansky, DMD  

An excerpt from Spare the knives…save the dental souls! published in Dental Economics, March 1, 2002 

For many in our profession, the daily onslaught of difficult procedures, rejected treatment plans, assistants who just don’t get it, the end-of-the-month cash-flow crunch and other office “fires” can lead to a fate not unlike the victims of the Chinese torture. 

The ancient Chinese employed a form of slow execution called “The Death of a Thousand Cuts” in which the victim was sliced repeatedly with a knife. Each individual wound was superficial and nonlethal, but the accumulation of hundreds of cuts proved fatal and caused much more pain and suffering than one sure stroke. 

Henry David Thoreau said, “The mass of men lead lives of quiet desperation.” I’ve come to believe that, in dentistry, there are a higher proportion of people in that category than normal. We start our dental practices to give ourselves more life; yet, inevitably, our practices slowly suck up the lives we have. 

Ironically, it wasn’t the dentistry that caused my distress. It was the “business” of dentistry that devoured my soul. All things being equal, I love the clinical side of my profession. But all the problems that confronted me in my practice—social, financial, and physical, during the normal day-to-day routine were overwhelming. The business of dentistry is hard! Unfortunately, I didn’t quite recognize that at first. 

Like many people, I studied philosophy at college, enjoying the sense of order that a well-constructed framework of ideas could bring to an otherwise indecipherable argument or problem. So, when faced with such a myriad of problems in the early days of my practice, quite naturally, I began to search for a philosophy of dentistry that would help me make sense of the issues at play. 

I looked to successful dentists to find my mentors, and, at the time, there were some great ones—Pankey, Dawson, Reed, Becker, Barkley. What I learned was a real eye-opener! I thought the antidote to my woes would be advanced clinical skills; however, these dental gurus were talking just as much about staff management, financial control, and the philosophy of running a business as they were about how to cut a great crown prep! I was surprised, but it made sense. I put these ideas into effect, and my practice turned the corner from that time on. 

By Laura S. Harkin, DMD  

My dad and I were enjoying our favorite lunch spot years ago when he turned to me and said, “Laura, isn’t it amazing? There’s an incredible sense of trust that our patients have in us. Sometimes, we give our best recommendation for treatment, and it is declined as if it weren’t important or a priority. I’ve recognized that, more often than not, our patients eventually choose to move forward, proving that it was more a matter of timing and circumstance than lack of value.” 

Trust is the cornerstone of our practice. It was transferred from patients to Grandpa to Dad and to me. I do believe that every morsel is earned through guidance, thoughtfulness, and skill. Trust is an entity that requires constant nurturing. In private practice, one should recognize that a doctor’s trust in their patient is equally as important as a patient’s trust in their provider. With synergy there’s the opportunity for optimal health. Even as a child, I had a very clear understanding of the care my dad had for his patients. This feeling is innate and deeply imbedded in me. I imagine that he felt the same.  

I don’t consider myself “a writer,” but I’ve always enjoyed the art of letter writing. I grew up writing frequently to my grandparents and friends and always loved picking out stationary that reflected my personality. Recently, I reread the letters that my grandfather typed on his old typewriter and my oldest brother scribbled on his Grateful Dead CD inserts – crafted just for me. It seems fitting then that I enjoy writing personalized letters to my patients. In fact, I’m pretty sure I salvaged my mental health during COVID by writing “updates” to my patients during months of closure. I digress. 

The letters that I write to my patients are most often in reference to comprehensive treatment. They provide a bird’s eye glimpse of our most recent findings, diagnoses, and treatment recommendations. My older patients, especially, appreciate my thoroughness, organization, and systematic approach to recommended treatment. These letters certainly aren’t handwritten, but the hard copy renders a sense of care that’s transferred from my hands to theirs. We must remember that individuals comprehend and retain information differently. The one-on-one, verbal, treatment consultation can become lost in the shuffle of everyday. Add dental language and complicated procedures to the mix, and that’s simply a recipe for confusion.  

Whenever I present complex treatment to a patient, I write a letter in everyday language to support our conversation. It’s stored in their digital chart as part of their dental record. In my first paragraph, I state my patient’s chief complaint. A summary of clinical findings followed by bullet point. Next, I provide my best treatment recommendation, an appointment sequence, and the financial investment. Photographs are also a helpful insert to aid in explanation for family members who were unable to attend the consultation. I think there’s value in a tangible letter taken home to revisit.  

Treatment letters are also an irreplaceable resource for my team. When a patient calls to schedule treatment previously presented, my stored letter immediately becomes a reference for scheduling appointments, including time allotments and space in-between subsequent visits. In my office, we offer a courtesy for treatment paid in full. This amount is figured in the financial investment portion of my letter so that conversations regarding immediate payment or a payment plan can easily flow. Should a case not be accepted prior to a routine recare visit, this letter serves as an excellent reminder during team huddle. It’s inefficient to page through multiple chart notes and software-driven plans with no explanation of the diagnoses which caused a need for restoration in the first place.  

In my first few years of practice, it was hard for me to accept that I needed to view this document as fluid with a potential need for multiple modifications to suit my patient’s desires and limitations. For example, financial concerns often lead to the need for phased treatment or a compromise from the ideal. I’m committed to openly discussing what may occur if no treatment is rendered or if a compromised approach is chosen. Likewise, I believe in the importance of presenting the financial component of extensive treatment myself. As the dentist and business owner, I must “own” the fee that I’ve carefully determined to reflect indirect and direct time, the skill level and support to be provided by my team, the technical excellence of my laboratory technicians, and my own knowledge. The fee that I present is steadfast, barring an unanticipated need such as root canal therapy. Should there be a need for additional chair-time or visits, it’s included in the quoted fee.  

Finally, my letters include my expectations for post-treatment maintenance. For example, if we are to complete a hybrid case in conjunction with a surgeon, I’m careful to share the importance of periodontal health and frequent maintenance visits to prevent peri-implantitis. In patients who have pre-existing medical conditions that when uncontrolled can be contradictory, I stress the importance of regular monitoring. Ultimately, I strive to empower my patients to choose and achieve oral health, Undoubtedly, oral health positively impacts overall health. My personal letters are a distinguishing trait of my practice that convey the level of care to be carried from presentation through treatment and in maintenance. Consider the value in this extra step! 

Clayton Davis, DMD 

Hint: It wasn’t because I was cold. 

A First Impression I Will Not Forget 

One of the activities my family enjoyed on our vacation to Ireland 25 years ago was visiting the famous McGee tweed factory in Donegal. They had a loom set up so visitors could pick out threads, weave with the shuttlecock, and make a pattern. My children were at an age when that was very entertaining. 

On our last day in Ireland, we walked the main street of Sligo and stopped in the Mullaney Brothers haberdashery. While my wife looked for a few things, I waited with no intention of buying. An elderly gentleman walked up behind me, and with a charming Irish brogue asked, “I say, sir, are those your children over there?” I said, “Yes.” And he said, “Oh, they’re fine looking  children. They are a credit to you, well behaved.”  

As the conversation proceeded, he introduced himself as Mr. Johnny Mullaney. He inquired about where I lived and what we had done while in Ireland. He mentioned how he enjoyed watching the Olympics in my hometown of Atlanta. He knew a lot about Markree Castle, our accommodation for the week, and Rosses Point, a golf course I played at. He enthusiastically shared his opinion of its famous 18th hole. He was immensely proud of the golf course. Then he mentioned the pride they had in their tweed jackets made from tweed from the McGee tweed factory.  

He pointed to the jackets and asked which of the tweeds I liked best. I pointed to one and he said I appeared to be size 41L (exactly right), and before I knew it, he had slipped the jacket over my shoulders. As he brushed his hands over my shoulders and down the sleeves and tugged at the cuffs and bottom of the jacket, it felt tailor-made for me. I told him I liked the way it fit, but our luggage would be tightly packed for our trip home. I expressed my concern the jacket would end up badly wrinkled. He said, “Oh, it’s tweed, sir. We can fold it very nicely and have it ready for you to pack and it will unfold without wrinkles when you get home.” 

I liked the look of the jacket, yes, and I appreciated the quality of McGee tweed. But ultimately, what I appreciated most, what made me want the jacket, was Johnny Mullaney, himself; the consummate haberdasher, a master at his craft, who won me over by becoming my friend in a mere five minutes.  

I thought, “I don’t have a memento of this trip. This jacket will always remind me of our wonderful trip, our day at McGee factory, and this endearing Irish businessman.” I said, “Mr. Mullaney, I will take the jacket.” 

What I Learned from that Lasting Impression 

There are four elements from meeting Johnny Mullaney that I apply to meeting every new patient in a preclinical interview: 

1. Make a friend. (How can you trust each other if you don’t become friends?) 

1. Make an invitation. (Accepting an offer to be examined makes co-discovery exams flow.) 

1. Make it easy. (Find out their concerns, and address them.) 

1. Connect the feeling to the choice. (People do business with people they like.) 

You see, we always make choices based on our feelings. The preclinical conversation allows the new patient to feel good about my desire to genuinely help them and understand their feelings and needs. This is how we can move forward toward optimal care.  

A Series of Invitations Lead to the Treatment “Yes” 

When dentists ask me how they can do more cosmetic and restorative cases, they are usually surprised when I tell them it begins with doing pre-clinical conversations at the first visit.  

• You can’t do comprehensive cosmetic and restorative treatment until you’ve presented a treatment plan.  

• You can’t produce a treatment plan until you’ve done a good diagnosis.  
• You can’t produce a diagnosis until you’ve done a thorough exam. 
• And that thorough exam is incomplete when it doesn’t start as a good preclinical conversation with the new patient. 

The preclinical conversation sets the tone for trust and healthy open communication. It is the essential first step in creating a lasting good impression that leads to the first “yes” in a series of invitations on the way to treatment.  

Charlie Ward, DDS  

Whether you want to use a digital SLR camera for documentation, patient education, lab communication, making presentations at dental events, dental publications, or accreditation in the American Academy of Cosmetic Dentistry, you have choices to consider in multiple price ranges.  

Dentists can spend $1,800 and get a good system for documenting cases, patient education and lab communication. Dentists can easily spend $3,800 or more on a setup to equip themselves to take higher quality images. 

Camera Body: Most dentists shoot with a Nikon or Cannon DSLR camera. These are comparable brands. My experience is with Canon but my lab technician uses Nikon and gets wonderful results. I am shooting with the Canon EOS 90D. The comparable Nikon is the D7500. More entry-level models are the Nikon 3500 and the Canon Rebel T8i. 

Lenses: We can get a third-party Sigma 105mm or a Tokina 105mm lens that gives us decent quality, or we can purchase the Canon 100mm or Nikon 105mm version at twice the price. When I upgraded to the finer Canon lens, I noticed a huge difference in image quality. I recommend an upgraded lens for the highest-quality images you need for accreditation. 

Flashes: The ring flash is a great entry-level option and significantly less expensive but there are limitations to what you can do to control your light. I’ve been using a dual point flash for some time. I can pull a flash off and shoot from a different angle. By changing where the light is coming from, I can accentuate the angle lines for more depth and visual clarity.  

Sometimes, I’ll take one of my flashes off, hold it on the opposite side of what I am shooting, and shoot the flash back into the lens of the camera. When I do this, I get an ethereal-appearing image or an image with a white background. I appreciate the versatility of using the dual point system.  

For my best-looking images and portraits, I’ll use softboxes. This gives smoother, more diffuse light and a beautiful appearance. These are necessary for everyday dentistry but make a huge difference in showcasing aesthetic cases.  

Consider the Long Term: When dentists invest in cameras and lenses, they typically use them for a long time. If you are on the fence about how much you want to invest, my own experience might be helpful. I honestly wish that I had upgraded sooner than I did with the Canon EOS 90D and the Canon 100mm lens. After taking photos for 12 years, the upgraded equipment has only increased the joy I have for photography and pushed me to take more pictures! 

Do You Know Your Team’s Threshold? 

Robyn Reis, Dental Practice Coach 

While visiting a dental practice that had amazing hospitality and incredible relationships with its patients, I observed a doctor’s presentation to a patient who was in his forties and who had been saving for a smile makeover for a long time. The doctor did an amazing job with his presentation of what was possible and the phases of treatment. The patient was very excited, even teary-eyed.  

The patient wanted to get started and asked about the cost. The doctor said, “You know what? My team at the front are experts in figuring that out.” So, the patient was taken to the front and handed over beautifully. In a few minutes, he was presented with the treatment plan on paper with the approximate dollar amounts. In phases, they would do the full mouth. All seemed to be going well until it wasn’t. 

Intrinsically, everyone has a monetary threshold that up to a certain point, you have no problem with the amount. It’s something within your range of expectations and easy to say yes. When you cross that threshold, anxiety may creep in and for sure, you become uncomfortable.  This is what I witnessed in a matter of moments. 

I observed the front office team member look uncomfortable after glancing at the paperwork, despite being experienced with treatment presentations. The clinical assistant who had been part of the diagnosis and treatment planning process, would also help with scheduling and any questions. 

Together, they gave the patient the opportunity to ask questions after reviewing the plan again. The full mouth restoration was going to be in the neighborhood of $25,000. The first phase would be about $18,000. They offered CareCredit financing. The patient said, “It’s only $25,000 and I have $20,000 saved. This is wonderful! I don’t know how I will pay the other $5,000, but I know I have the means. It’s only $25,000.”  

The team appeared somewhat shocked because they were obviously uncomfortable with quoting that amount. This treatment plan crossed their personal thresholds. They suggested the patient go home and sleep on it “because this was a big investment.” The patient was so committed to moving forward that, despite their advice, he scheduled his first appointment. He would call them back once he figured out how to pay the remaining balance, knowing insurance would contribute very little. 

What I also found interesting was that neither team member asked for a deposit. No money was exchanged to reserve an extended appointment. The patient could back out and the doctor’s time spent on the case work-up would be uncompensated. In my experience, making a signed financial agreement would be the responsible step to take at this stage.  

This example illustrates the discomfort many dental teams feel about asking for a deposit if the treatment estimate crosses their personal threshold. Of course, dental teams will want to explain what can be done to make treatment more affordable and the financing options that are available. But it is beneficial for team members to understand their personal threshold and to become comfortable saying, “Grab your checkbook or pull out your credit card, Mr. Jones. Here’s what your investment is going to be to get started.”  

What’s your threshold? This is a great team exercise you can do at your next meeting because a patient might ask anyone they interact with about the cost of dentistry, and what options you offer for the dentistry they want.  Every team member will benefit from considering their personal threshold and discussing it — even role-playing — to become comfortable with the best ways to manage these questions. Depending on the situation, it could be referring the patient to the treatment coordinator or to the financial administrator to have a comfortable conversation. 

It is my belief that when patients are excited about what the treatment results will be and they want to move forward, it’s the right time to ask the patient to make a financial commitment to get the process started. 

Personal Finance Tips for New Dentists 

Kelly Brady, MBA 

Here are a few thoughts I hope are helpful for young dentists starting out in their careers. 

I Would Make Buying Disability and Life Insurance a Priority. 

I recommend that you have personal disability insurance and that you make sure it has own-occupation and guaranteed renewable features. Disability insurance protects you from the financial risk of losing your income if you become sick or disabled and you cannot work. Own-occupation policies allow you to claim disability insurance benefits even if you can earn an income doing something other than your most recent job. 

Personal disability plans have add-ons that vary from state to state and company to company. The most expensive add-on is the COLA or cost of living adjustment. That will nearly double the price of the plan. If you struggle with wanting to pay the premiums, then don’t get this add-on. The price can be kept low by buying a plan that has a 90-day period before coverage kicks in. 

If you have dependents or you expect to buy a practice, I recommend that you buy term life insurance. At some point in the future, you’ll probably need to pledge life insurance against the practice. If you do not own a practice yet, I recommend that you avoid whole life, permanent life, and universal life policies, as they are more expensive, loaded with fees, and the person selling them is making a large commission.  

If You Build an Emergency Fund, You Will Be More Secure. 

The next thing I recommend is to build an emergency fund that is not invested in the stock market but rather kept in a savings or money market account, or invested in government treasury bills that are short-term. This way, if there is an emergency, the money’s available and there are no surprises. A good rule of thumb is to have emergency savings that equal three to six months of your income. If you have a disability policy that won’t kick in for 90 days and are disabled, you will be glad you have this 

Take Advantage of an Employer Retirement Plan. 

If you have access to an employer retirement plan, maybe even in your own practice, make regular contributions. If you are employed by a dental practice that contributes a matching percentage, contribute enough to get the match. Dental practice owners can set up an employer retirement plan. A recent PankeyGram article by Dr. Mark Kleive provides great advice for doing that.  

Pay Off Credit Card Debt. 

It makes sense to pay off higher-interest credit cards first. Keep in mind that If the interest is the same, it makes sense to pay off the personal debt first because the business card interest is tax deductible, essentially lowering the rate of interest. 

What if paying down debt means you don’t have the ability to save for retirement? Ideally, you will maximize saving/investing in tax-advantaged accounts like IRAs and 529 college savings accounts. But if you are paying down debt, the 20% annual interest you are saving is like getting a 20% investment return with no risk.  

For some people, paying off debt or investing in retirement is a choice they must make. Some can’t sleep at night worrying about one more than the other. Because different people have different priorities and personal situations, I recommend that you get a second opinion to help you decide. 

What About Dental School Loans? 

Dentists can pay off student loans by sticking to a regular monthly payment plan, refinancing to pay them off faster, or consolidating with a personal loan. 

One of the things that I take the opportunity to do every year in January is evaluate my fees. I am disciplined about this because the cost of doing business goes up every year.  

Whether it is a low inflationary time when the cost of doing business has gone up 1-1.5%, or it is more like the recent period when the cost of doing business has gone up 7-10%, our profitability is going to decrease if we don’t adjust our fees. When profitability decreases, usually the dentist’s compensation decreases.  

The Fee-by-Fee Way 

We can go through our fee schedule, fee by fee, and raise them individually. Dentists who do this are concerned that they will lose patients if they raise certain fees, for example, their fees for regular recall exams and dental cleanings. Dentists who take the fee-by-fee approach tend to believe patients are less price sensitive to the cost of restorative dentistry and appliances. Some dentists cover the increasing costs of Hygiene by increasing the fees for their restorative procedures. 

The Global Way 

Alternatively, we can do a global fee increase that raises every fee by the same percentage. This is my preferred way. To select the rate, I will look at my 2023 end-of-year profit and loss statement (from my accountant) and compare it to my 2022 end-of-year profit and loss statement. Did I make a profit in 2023? Was it higher or lower than in 2022? I don’t want to make less profit year to year.  

I will also look hard at my practice’s operating expenses in 2023 compared to 2022. I expect 2023 will be significantly higher because we have gone through high inflation in 2023 that none of us could have reliably predicted at the end of 2022.  

For example, if overhead was 65% in 2022 and jumped to 68% in 2023, I must increase my fees by at least 3%, plus a percentage I anticipate will cover overhead increases in 2024. If my profitability decreased in 2023, I also would want to compensate for that loss in the future. (Our “healthy business” goal each year is to maintain and hopefully increase profitability.) 

To arrive at the final percentage that I will raise my fees across the board, I will factor in the raises I want to give my team and myself in 2024, and the other expenses I know (or anticipate) will go up.  

The Global Way Is Easier 

If we do piecemeal fee increases, it becomes a complicated set of mathematics to determine if we will recapture last year’s decrease in profitability, cover next year’s increase in overhead, and hopefully increase our profitability over the next year. If you want to be cautious, you can blend the two approaches. Do a global increase and then go back and look at the price-sensitive fees you are concerned about and lower just those. This is the Modified Global approach. 

Evaluate Your Fees Early in 2024 

Annual evaluation of our fee is a must-do, and I don’t think there has ever been a better time to raise fees in all the years I have practiced. We live in a time when everything costs more. Patients understand that our overhead costs have increased. They know we are running a business and want us to stay in business to be there for them. 

I encourage you to use a system of thinking to figure out which fees you will raise and how much you will raise them. I advocate for the global approach or the modified global approach. Ask your accountant to give you profit and loss statements for 2022 and 2023. If you need help with your evaluation, ask your accountant or practice management consultant to assist you. 

Umbrella liability coverage provides additional liability protection over and above your existing policies. A personal umbrella is going to provide that coverage over your auto insurance, your boat insurance, and your renters or homeowners insurance.

Typically, you must have a minimum amount of coverage in each of those areas. Usually, it’s $300,000 in bodily injury for your auto and about a hundred thousand in property damage. And then also for your homeowners, you usually need a minimum of $300,000 in liability coverage for your homeowners or renter’s policy. For example, if you have an auto claim where you’re at fault, and there is a half million dollars in bodily injury and the underlying limits on your policy are $300,000, your policy will pay the $300,000. The additional $200,000 that you owe would be paid by the umbrella. With a one-million-dollar umbrella, you have $1.3 million in coverage.

Umbrellas Provide a Lot for Relatively Little

By buying an umbrella policy, you’re adding a lot more protection at a very low cost. They come in increments of a million dollars, and you can buy several million more.

The beauty of this is that that policy may only cost a few hundred dollars a year depending on the features you might add to it. Umbrella policies might protect against some unusual things, for example, slander and liability claims. If you have a second home that you visit or rent, the umbrella will usually cover the liability.

Life is full of surprises, so it is wise to have a lot more coverage than the minimum homeowners and renters insurance policies provide.

Commercial Property Insurance

I think every dentist needs at least a one-million-dollar umbrella covering their commercial property. If something happens on your property for which you are liable, a lawsuit can run into high dollars—some run into multiple millions. If you have $1.5 million in commercial assets, at least $2 million in total liability coverage would be appropriate. Someone could have a $2-million-claim by tripping and falling, even if your commercial assets do not amount to that much.

Professional Liability Insurance

Regarding professional liability, you can’t buy an umbrella but you can buy more base coverage. Base coverage is usually available in million-dollar increments. If you have concerns, contact your insurance providers, as well as other providers to compare policies and costs. It could be inexpensive for you to have the extra financial security of an umbrella.

Additional Considerations

• When purchasing umbrella liability insurance, the extra millions above the first million are usually less expensive than that first million.
• If you have children under the age of 25 who are drivers under your auto insurance policy, an umbrella policy will have an added charge to cover the extra risk of the young driver.
• If someone were to injure you or your auto and they are underinsured, your auto insurance liability umbrella might kick in and cover your expenses. That’s something to look into and consider when making insurance choices.