Covering Your Assets: Insuring Body Parts
Ever watched a celebrity gossip news show? Come on, be honest!
Ever read a celebrity gossip magazine? Still lying to yourself?
Okay, how about you’ve stood in a checkout line at the grocery store and seen the cover of a gossip magazine? Gotcha!
Then you’ve probably seen a headline about a celebrity buying an insurance policy on a part of their body. For many years, celebrities have garnered press attention for taking out such policies—among many other things. You’ve probably heard of singers insuring their vocal cords, athletes covering arms/legs, supermodels insuring facial features, and the list goes on.
You can see some of the most mind-blowing body-part insurance examples here.
Why a Specific Body Part?
At a glance, it may seem like just another celebrity extravagance. But such an insurance policy makes perfect sense to the people who can afford to buy it.
The purpose of such coverage is to supplement lost income if a body part is damaged, injured, scarred, handicapped or lost. Consider the following quote from TV star Holly Madison, who recently made headlines for insuring her—let’s just call it “upper torso”—for $1 million. “If anything happened…I’d be out for a few months and I’d probably be out a million dollars,” Madison told People magazine. “I thought I’d cover my assets… They’re my primary money makers right now.”
Are Only Celebs Eligible?
Is insuring body parts only a luxury reserved for the rich and famous? It may seem that way if you’re reading the news.
Body part insurance similar to that purchased by celebs typically is not something offered by standard insurance companies. Therefore, you likely must find a specialty insurance provider such as Lloyd’s of London to provide the policy. Such a policy can be created from scratch specific to an individual’s needs. This personal attention, coupled with having to purchase from a specialty provider, can result in a premium not affordable to many folks.
That said, celebs are not the only individuals who seek out this type of insurance. Some business owners will look to a specialty insurance provider for a policy designed to help keep the business open if their ability to run it is compromised due to a damaged body part or function. For example, a chef or wine expert who loses the ability to taste or smell could easily lose his or her business and livelihood if those senses were compromised.
Some insurance companies offer coverage for “death and dismemberment” resulting from an accident. While not as glamorous as a policy on a movie star’s legs, such an insurance policy may be an affordable way for people to supplement income due to the inability to work after losing a body part. However, for such a policy to apply, a body part typically must be lost—these typically don’t cover lost income due to injury or slowdown.