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Disability Insurance Finder

Ensure you'll still get a paycheck if you can't work after an injury or illness.

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A disability that puts you out of work could be more debilitating than you’ve planned for. That’s where disability insurance comes in. It can protect your livelihood and replace a portion of your paycheck if you can’t work due to an illness or injury.

Does disability insurance cover coronavirus?

Yes, most disability insurance policies will cover you if you become too sick to work due to coronavirus. However, there are a few exceptions when your disability policy wouldn’t cover coronavirus:

  • If you catch the coronavirus before you apply, that’s considered a pre-existing condition and might not be covered.
  • You’ll typically need to get a diagnosis from a doctor.
  • You’ll have to prove you can’t do your normal job at all while you recover.
  • Your illness will also have to extend past the elimination or waiting period to receive payments.
  • Don’t expect to get your full salary on disability. Typical payouts for a short-term policy are between 60 to 80% of your normal pay.

Compare disability insurance companies

Data indicated here is updated regularly
Name Product Coverage Amount Benefit period Waiting period Own Occupation Medical exam required
Prudential disability insurance
Short-term: $100–$3,000
Long-term: $300–$6,000
Short-term: 3, 6 or 12 months
Long-term: Up to ages 65, 67, or 70, or 2 or 5 years
Short-term: 30, 60 or 90 days
Long-term: 90, 180 or 365 days
No
Yes
MassMutual disability insurance
Not listed
2, 5 or 10 years or up to age 65, 67 or 70
60, 90, 180, 365 or 730 days
Yes
Yes
Guardian disability insurance
$500 to $20,000
2, 5 and 10 years to age 65, 67 and 70
30, 60, 90, 180, 365 or 720 days
Yes
Yes
Principal disability insurance
$400 to $20,000
Up to ages 65, 67, or 70, or 2 or 5 years
30, 60, 90, 180 or 365 days
No info available
Yes
Mutual of Omaha disability insurance
Simplified issue: $300–$4,000
Short-term: $300–$5,000
Long-term: $300– $20,000
Simplified issue: 12, 24 or 36 months
Short-term: 3, 6, 12 or 24 months
Long-term: 2, 5, or 10 years, or to age 65 or 67
Simplified issue: 30 days (injury) or 90 days (sickness)
Short-term: 0 (accident), 7, 14, 30, 60 or 90 days
Long-term: 60, 90, 180 or 365 days
No info available
No
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What is disability insurance?

Disability insurance pays out a percentage of your salary if you’re unable to work due to a covered injury or illness. It replaces part of your paycheck for a specified period of time, and each insurer has a list of disabilities that qualify for benefits.

There are two types of coverage:

How much is disability insurance?

Your premium will come down to your coverage amount, benefit and elimination period, occupation, health and where you live. To give you an idea of how much you might pay for coverage, the average cost of a long-term disability insurance policy is 1-3% of your annual salary. So, if you earn $65,000 a year, you might pay between $650 and $1,950 a year.

Is disability coverage worth it?

If you don’t have enough savings or funds to cover your daily living expenses for a few months, you might need disability insurance. But there may be some circumstances where disability insurance isn’t a necessary safety net in case you become disabled.

Consider disability coverage if:

  • You’re the breadwinner of your family
  • You don’t have any coverage through your job
  • You’re self-employed
  • You’re paying off debt
  • You’re a caregiver
  • You’re in an injury prone profession

But you might skip disability coverage if:

  • You have enough money. If you’ve got enough savings, you may be able to self-insure to cover the risk of not being able to work.
  • You’re in the military. If you’re in the military, you could have a disability policy provided through your military benefits.
  • You have family to rely on. If you have a trust fund or your spouse makes enough money to support the family if you couldn’t work, you might not need disability coverage.
  • Social Security disability is enough. If you don’t need much money and you’re content with the amount you’d receive from Social Security disability, you might be okay without purchasing a disability policy.But keep in mind qualifying for Social Security disability can be a difficult process.

How does disability insurance work?

When you apply for a policy, you’ll need to choose an elimination period. Also called a waiting period, this is the length of time you’ll need to pay for expenses out of pocket while you wait to receive benefits. It starts on the day you become disabled. The elimination period usually ranges from one to 90 days for short-term disability insurance or seven to 720 days for long-term disability.

Once your elimination period ends, the benefit period begins and you’re eligible to collect benefits. The benefit period for STD tends to be limited to 30, 60, 90, 180 or 365 days, while LTD pays out up to a specific age or for a set number of years. After the benefit period is over, you’ll stop receiving disability benefits.

Short-term vs long-term disability insurance

The best type of policy for you depends on your financial situation. Short-term disability insurance can replace up to 80% of your salary, but the benefit period is limited. It’s best for those who don’t have an emergency savings fund to fall back on.

On the other hand, long-term disability insurance lasts several years or even until retirement, when Social Security steps in. The list of covered illnesses and injuries is far more comprehensive, and includes the likes of arthritis, back pain and heart disease. However, it’s usually more expensive, so factor that into your decision.

Short-term disability insurance typically pays 80% of your salary, and long-term disability insurance replaces around 60% of your income. While your salary is taxed, disability benefits aren’t — so the final amount can come pretty close to what you were taking home before your disability.

What qualifies for disability benefits?

It depends on your insurer, and the type of disability insurance coverage you have. But generally, these conditions are covered under each policy:

Short-term disability Long-term disability
  • A disabling injury — like a broken leg or hand
  • A prolonged sickness — such as glandular fever
  • A musculoskeletal disorder — including arthritis, back pain or spine and joint disorders
  • A chronic digestive disorder — like gastritis
  • A mental health condition — such as anxiety or depression
  • Pregnancy and maternity leave
  • Musculoskeletal and connective tissue disorders — like osteoarthritis, chronic back pain or slipped disks
  • Accidental injuries — like brain trauma caused by a car accident
  • Cardiovascular disorders — such as heart attacks or serious heart conditions
  • Circulatory disorders — like coronary artery disease
  • Prolonged mental illnesses — including PTSD and major depressive disorders
  • Cancer

    What happens if I’m disabled but can still work?

    The answer lies in your insurer’s definition of disability and whether you can work at all. There are two types of plans:

    • Own-occupation disability insurance pays out if you can’t work in your usual occupation, but you can work a different job.
    • Any-occupation disability insurance pays benefits only if you can’t perform any job. To qualify, you’ll need to prove you don’t have the physical or mental capacity to work at all.

    Which one should I pick?

    Own-occupation policies are typically more helpful to people with physically demanding or high-paying jobs, such as doctors or dentists. Any-occupation policies mean you have to go down the list of possible careers and prove you can’t do any of them before the policy will pay out.

    For example, say you make $200,000 as a doctor and your hand is damaged during a surgery you’re performing. An own-occupation policy would pay you around 60% of your salary until you could return to work. An any-occupation policy might not pay out if you could still work as a receptionist making $30,000.

    Where can I get disability insurance?

    If you’re sold on the idea of securing a “replacement paycheck” in the event you can no longer work, here’s how to go about it:

    • Check for employer-sponsored coverage. In California, Hawaii, New Jersey, New York and Rhode Island, employers are legally required to offer short-term disability plans to their employees. If you live outside those states, it’s worth asking your workplace if STD is offered as part of your employee benefits.
    • Buy an individual policy. You can purchase a policy directly from an insurance company. The major benefits of choosing this option are that the coverage is portable, and you’ll be able to customize your elimination and benefit periods to suit your financial situation. Just be sure to shop around to get the best possible rate.
    • Go through a professional association. Some professional associations partner up with disability insurance companies to offer policies at discounted rates.

    How do I save on disability insurance?

    To cut down on your premium, you can:

    • Increase your elimination period. All long-term disability policies have a waiting or elimination period. Basically, this is the time between the start of your disability and when the insurance company begins paying out your benefits. The shorter the waiting period, the more expensive the policy. If you choose a waiting period of 90 days or longer, you can save. However, in the meantime, you’ll need the savings to self-insure or put in place a short-term disability policy — which you may be able to get through your employer.
    • Decrease your benefit period. The benefit period is the amount of time your policy will pay out benefits. The shorter the period, the cheaper the premium. The longest benefit you can get is until retirement age — for most carriers, that’s 67, though some can go up to age 70. The average disability lasts three years, so you might want to consider a benefit period of five or 10 years.
    • Reduce your monthly benefit. The maximum monthly benefit most companies pay is between 60% and 70% of your current gross salary. If you think you can manage with less money, you can lower your monthly benefit, thereby lowering your premium. This can be a risky option, though, as disabilities can be costly.

      What should I watch out for?

      When purchasing your policy, you’ll want to make sure you fully understand your benefit options and exclusions before committing to a policy. Here are some things to keep an eye out for:

      • Waiting period. Sometimes referred to as an elimination period, this is the amount of time you’ll have to be out of work before receiving your first disability check. Make sure you know how long you’d be able to go without your income before choosing a waiting period.
      • Exclusions. Make sure you’re fully aware of any specific conditions or situations that won’t be covered. Also, you’ll want to know the amount of time you’ll have to wait before pre-existing conditions are covered.
      • How to file your claim. Check with your potential insurance provider to see how exactly you would file a claim and what information you will have to keep to prove your disability.
      • Denials and appeals. Talk with your disability provider to find out what happens if a claim is denied and what the appeal process involves.

      Learn your legal rights under the Americans with Disabilities Act (ACA)

      2020 marks 30 years of the Americans with Disabilities Act (ACA), a landmark law that aims to advance access and opportunities for those with physical and cognitive disabilities.

      The legislation spells out rights in relation to employment, transportation and telecommunications, as well as accessing government spaces programs and private facilities. It assigns a federal agency to handle each category, and offers avenues for disabled persons to explore if they experience discrimination.

      Your legal rights under the ADA

      What are the alternatives to disability insurance?

      Disability insurance might be an option if your careers would be limited by a disability. However, it’s not right for everyone. You might instead rely on:

      • Life insurance
      • Workers’ comp
      • Social Security Disability Insurance (SSDI)
      • Self-insurance

      Does life insurance cover disabilities?

      Unfortunately not. Life insurance policies don’t cover disabilities, which means you won’t get a payout if you become fully, partially or temporarily disabled, unless you add a disability rider to your policy when you first purchase it.

      Life insurance might be a better option for you if your family would be finacially devastated by your loss, moreso than if you became disabled. While disability can help replace your paycheck while you can’t work, life insurance could replace your paycheck for your family if you died.

      What’s the difference between worker’s compensation and disability insurance?

      Worker’s compensation protects employees who get injured or become ill on the job, while disability insurance can cover debilitating health conditions or injuries on and off the job, depending on your policy. If you don’t have a high risk job, you’re typically not likely to become disabled at work.

      What about Social Security Disability Insurance?

      Social Security Disability Insurance (SSDI) is a program that pays benefits to people with total disability who haven’t been able to work for a year or more. However, it’s difficult to get approved and the average amount you’d receive each month is less than $1,200 – so don’t count on it as a surefire plan.

      To qualify, you must prove an “inability to engage in any substantial gainful activity” due to medical reasons for at least a year. Additionally, you must have previously worked in jobs covered by Social Security, and you must meet the Social Security Administration’s “disabled person” criteria, which includes severely limited mobility and a monthly income of less than $1,220 a month.

      It’s also worth mentioning that 65% of people who file a claim for SSDI are denied, due to the strict criteria to be considered disabled. If you’re declined, you can appeal the decision, though the process can be long and you may have to file several appeals.

      Bottom line

      Disability insurance pays benefits if you become disabled and can’t work, making it the truest form of income replacement. A policy can help you to cover your living and medical expenses until you’ve recovered from an injury or illness. You can choose between short-term and long-term coverage, which have different elimination and benefit periods — but neither will replace your entire paycheck.

      Explore your options by comparing disability insurance companies.

      Frequently asked questions about disability insurance

      Read more on this topic

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