Best Disability Insurance

Auto, homeowners and life insurance might come to mind as the trifecta of essential coverage everyone should have. However, it’s just as important to protect your way of life with disability insurance. This coverage helps protect your income if you experience a severe illness or injury that keeps you from working.

We researched and reviewed the best disability insurance companies. Read on to learn about our top choices and decide which company is the best fit for you.

Our Top Picks for Best Disability Insurance

• Guardian – Best for Long-Term Disability Coverage

• State Farm – Best for Short-Term Disability Coverage

• Assurity – Best for High-Risk Occupations

• Mutual of Omaha – Best for Short Waiting Period

• Breeze – Best for Affordable Insurance Premiums

Injuries and sickness can happen to anyone. Protect your income with Disability Insurance.

A long-term Disability Insurance policy can meet your particular needs. For a free quote, click on your state today.

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Best Disability Insurance Reviews

Best for Long-Term Disability Coverage: Guardian

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Pros

• Offers quotes online

• Many insurance riders available

• No medical exam required for supplemental coverage

Cons

• Medical exam required for most coverage options

• Must purchase coverage through an agent

• Doesn’t disclose short-term disability waiting periods

Why we chose it: Guardian is a reputable disability insurance provider with own-occupation coverage and many insurance riders available.

Guardian offers employer and self-employed short- and long-term disability insurance, which pays up to 70% of your monthly income if you can’t work. You can also augment either policy with a supplemental disability add-on.

Long-term disability coverage can last two, five, 10 or 20 years or until retirement age, with waiting periods of 90 to 180 days. Short-term disability insurance, on the other hand, can last up to 26 weeks. Guardian doesn’t disclose waiting periods for its short-term disability coverage.

Unlike other insurance companies, Guardian offers own-occupation disability policies, which pay out in the event you cannot perform the obligations of your current field or role, even if you’re still able to perform another job. This is different from other coverage types, which only pay out if you’re unable to perform any type of work.

You can customize your Guardian disability policy with several optional riders. These include a cost of living adjustment, basic and enhanced partial disability coverage, lump sum disability and catastrophic disability benefits. Student loan and retirement protection are also available.

Guardian sells disability insurance in every U.S. state, although certain areas have limited coverage. You can get an estimate online, depending on your location and occupation. To actually purchase a plan, however, you must contact a Guardian agent. Guardian doesn’t require medical exams to purchase supplemental coverage, but you must complete a short questionnaire.

Guardian has a superb AM Best rating of A++ and an A+ customer satisfaction rating from the Better Business Bureau (BBB).

Best for Short-Term Disability Coverage: State Farm

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Pros

• Short-term coverage available for up to three years

• Make payments monthly or annually

• Easy application process

Cons

• Must purchase coverage through an agent

• Waiting periods range from 30 to 90 days

• Not available in every state

Why we chose it: State Farm offers affordable short-term disability insurance that can last up to three years and pay a maximum benefit of $3,000.

State Farm is one of the largest insurers in the United States and offers individual short- and long-term disability insurance. Its long-term disability insurance can cover up to $20,000 monthly, depending on your plan, with benefit periods of five or 10 years or extending to a retirement age of 65 or 67.

State Farm’s short-term disability insurance can last one or three years, and benefit payments range from $300 to $3,000. Waiting periods for short-term plans are 30, 60 or 90 days.

State Farm also sells individual credit disability insurance, which can protect your credit score and help you pay off debts if you’re unable to work.

To get a quote and purchase a plan, applicants must speak to an agent. However, once you’ve signed up, you’ll be able to manage your account and pay your bills through State Farm’s online platform.

State Farm has the highest AM Best rating at A++. However, the BBB currently rates State Farm a B in customer satisfaction. Coverage is available in all states except Massachusetts, New Jersey and Rhode Island.

Best for High-Risk Occupations: Assurity

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Pros

• Covers high-risk occupations that other providers do not

• Zero-day waiting period available, depending on policy

• Coverage is renewable to age 75 if employed full-time

• Offers quotes online

Cons

• Must purchase coverage through an agent

• Limited availability for Florida and Massachusetts residents

Why we chose it: Assurity is known for providing coverage to workers in dangerous occupations. While many other providers don’t extend policies to construction workers, machinery operators and electrical technicians, to name a few high-risk professions, Assurity does.

Depending on the policy, Assurity provides long-term disability with benefit periods of one, two, five or 10 years. Coverage is guaranteed renewable until a retirement age of 65 or 67 and can last until age 75 for those who can maintain full-time employment.

Long-term policies include up to $20,000 in monthly coverage after waiting periods of 30, 60, 80, 180 or 365 days for individuals. Short-term policies provided through employers offer waiting periods of zero to 30 days.

Assurity provides online estimates, but if you wish to purchase coverage, you’ll need to talk to an agent. The company’s underwriting process isn’t automated, which means your application can take some time to process and you may need to provide medical records.

AM Best has awarded Assurity a financial strength rating of A-. It also has an A+ rating from the BBB. Some coverage options aren’t available in Florida and Massachusetts.

Best for Short Waiting Period: Mutual of Omaha

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Pros

• Zero-day waiting periods available

• Many insurance riders available

• Coverage can last up to age 70

Cons

• Doesn’t offer quotes online

• High monthly premiums

• Must purchase coverage through an agent

Why we chose it: While many disability insurance providers require waiting periods of 30 days or more, Mutual of Omaha offers zero-day waiting periods in certain situations.

Mutual of Omaha offers long-term disability insurance coverage that can last until age 70, although the company can cancel your policy after age 67 if you don’t work full-time. You can choose when your benefits will begin: 30, 60, 90, 180 or up to 730 days depending on your policy. Monthly benefit payouts range from $300 to $20,000, depending on your income.

Mutual of Omaha’s short-term disability plans cover up to one year and have a zero-day waiting period in accidental injury cases. Employees with high salaries can get short-term coverage of up to $12,000 per month.

There are many customizations available for your policy. Some insurance riders you can add to your plan include the cost of living adjustment, return of premium, waiver of premiums for people disabled for 90 days or more, partial disability, critical illness, accident medical expense and hospital medical expense benefits.

Mutual of Omaha has an excellent AM Best rating of A+. The BBB also rated Mutual of Omaha an A+ for customer satisfaction.

Best for Affordable Insurance Premiums: Breeze

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Pros

• Get quotes and purchase a policy online

• Quick automated underwriting

• Long-term coverage starts at $9 per month

• Disability insurance available for self-employed workers

Cons

• Doesn’t have the history and reputation of other providers

• Limited availability for New York residents

Why we chose it: Breeze offers a budget-friendly long-term disability insurance plan with premiums starting at $9 per month.

Founded in 2019, Breeze is the newest disability insurance provider on our list. While you may want to pay extra for more comprehensive coverage, premiums for long-term disability coverage start at an affordable $9 per month. Depending on your policy, benefit periods can last two, five or 10 years or up to a retirement age of 65 or 67. Waiting periods for receiving benefits range from 30, 60, 90 or 180 days to one year.

Breeze’s short-term disability plans can replace up to 60% of your income, are guaranteed renewable to age 65 or 67 and can be conditionally renewed (under specific conditions outlined in your contract) until age 75. Waiting periods for this plan range from zero to 90 days.

Freelancers, business owners, Uber drivers and other self-employed workers will find excellent coverage with Breeze. Additional insurance riders are also available, including guaranteed insurability, residual disability benefits, automatic benefit increase and supplemental disability insurance benefits.

Breeze offers online estimates as well as the ability to purchase insurance online. Because its entire underwriting process is automated, you can get approved for a policy and be insured quickly. Most people don’t need to undergo a medical exam or submit medical records.

While it doesn’t have the long history of other providers, AM Best gave Breeze a financial stability rating of A-, and the BBB awarded it an A+ in customer satisfaction. Some coverage options are not available in New York state.

Other disability insurance we considered

Here are some other disability insurance providers that we considered.

Northwestern

Pros

• Strong financial stability

• Pays dividends

• Many insurance riders available

Cons

• Doesn’t offer online quotes

• Expensive premiums

• Must purchase coverage through an agent

Disability income policies from Northwestern Mutual are among the few options in the market that pay dividends. These can help lower your policy premium and save on coverage.

Northwestern offers short- and long-term disability insurance that can cover up to 100% of a policyholder’s salary. Instead of offering insurance riders, Northwestern allows customers to purchase extra coverage at certain ages.

AM Best gives the company its highest possible rating at A++, while the BBB awards it an A+ in customer satisfaction.

Although Northwestern is a good choice for disability insurance, the company’s high premiums mean it was not the top choice for any of the categories on our list.

The Standard

Pros

• Offers family care, rehabilitation and survivor benefits

• Short- and long-term coverage available

Cons

• Long waiting periods

• Individual disability coverage not available in every state

The Standard offers both short- and long-term disability insurance coverage. Short-term benefit periods can last up to one year, while long-term benefit periods can last one, two or five years or up to a retirement age (65 or 67), depending on your policy.

The Standard offers waiting periods between zero and seven days for its short-term disability policies. Long-term disability waiting periods range from 60 to 360 days.

With the standard, you can modify your disability coverage with a family care benefit. This unique option provides protection if you miss work to care for a family member experiencing severe injury or illness. Other riders include non-cancelable coverage, benefits increase and automatic increase riders.

The Standard has an A rating from AM Best and an A+ customer satisfaction rating from the BBB.

Principal Financial Group

Pros

• No medical exam required

• Options for part-time workers

Cons

• Agent required to purchase coverage

• Getting approved for coverage takes longer than with competitors

Principal Financial Group offers up to $20,000 in maximum monthly benefits for those who complete the full underwriting process, including a medical exam. It also offers simplified underwriting with no medical exam required, but monthly benefits max out at $6,000.

Long-term coverage extends for two and five years or until a retirement age (65, 67 or 70), with waiting periods that range from eight to 90 days.

You can purchase all of Principal Financial Group’s policies as individual disability insurance, allowing your coverage to follow you from job to job. Unlike other providers, Principal’s policies also cover those who work as little as 20 hours per week.

Principal Financial Group has an A+ financial strength rating from AM Best and an A+ customer satisfaction rating from the BBB. Online quotes are available, but you must speak with one of Principal’s agents to apply for coverage.

Disability Insurance Guide

It’s important to understand the ins and outs of disability insurance — and how it differs from other insurance products — before purchasing a policy. Read this guide to learn what disability insurance is, how it works and how to choose the best provider for you.

What is disability insurance?

Disability insurance gives you a percentage of your monthly income when you cannot work due to illness or injury. You can apply for this type of insurance plan through your employer, the United States Social Security Administration or a private disability insurance provider.

Depending on your policy, disability insurance can provide benefit payments and income protection for situations such as:

• Heart failure

• Fractures

• Pregnancies

• Arthritis

• Scoliosis

• Carpal tunnel syndrome

• Mental health issues

• Stroke

• Dementia

• Polio

There are two types of disability insurance coverage: short- and long-term. Short-term disability insurance covers temporary disabilities, and policies rarely provide payment benefits for more than one year. Long-term disability insurance, on the other hand, stays in effect until you recover from your disability, retire or coverage runs out.

While their names are similar, disability insurance (whether long- or short-term) is not the same as long-term care insurance, which offers coverage for health care at home or a facility. Long-term care insurance focuses on chronic health conditions or impairment to the extent that you can’t perform a minimum of two out of six daily living activities.

How does disability insurance work?

Disability insurance policies work differently depending on your insurer and policy. Your monthly premiums will depend on your health, income, length of coverage and more.

Many employers include disability income insurance in their employee benefits packages. Buying a group disability insurance policy through your employer can be more affordable but give you fewer options for policy customization. Also bear in mind that you’ll lose your coverage if you leave your company.

To receive government-sponsored disability insurance, such as through the Social Security Administration, you must prove that you cannot work because of a severe illness or injury that will impact your ability to work for at least one year.

Purchasing individual disability insurance through a private insurer can offer more flexible policy options and benefits. Individual disability insurance is an excellent option for self-employed professionals, but those who qualify for coverage through their employer may still want to consider this type of policy.

The 5 elements of a disability insurance policy

A disability insurance policy is an agreement between the provider and the policyholder promising financial support for the policyholder if they cannot work due to sickness or injury.

A disability insurance policy has five main components, regardless of whether it’s short- or long-term. These are the monthly premium, benefit payment, benefit period, waiting period and provider’s definition of a disability.

Monthly premium

Your insurance premium is the monthly amount you or your employer pay the insurance company for coverage. The cost of premiums varies based on many factors, including:

• Age

• Gender

• Health

• Occupation

• Income

• Type of coverage

• Benefit payment amount

• Insurance riders

Usually, the more dangerous your occupation, the higher the monthly premium you’ll need to pay for disability insurance coverage.

Benefit payment

Your benefit payment is the amount you receive from your disability insurance provider each month that you cannot work. Your benefit amount depends on your coverage but will often be between 60% and 80% of your monthly income.

If you receive coverage through an employer, your employer will likely make the premium payments using pre-tax dollars. In this case, your benefit payments will be taxed. If you have an individual policy and pay your premium with after-tax dollars, you won’t have to pay additional taxes on your benefit payments.

Benefit period

The benefit period is the length of time you’ll receive benefit payments from your insurance provider. For short-term disability insurance policies, the benefit period is usually under one year. A long-term policy’s benefit period can range from two years to the total time it takes you to recover from your disability, or until you retire at a set age.

Waiting period

The waiting period, also called the elimination period, is the time between when your provider deems you eligible for benefits and when you actually start to receive benefit payments. Waiting periods vary by insurance company but are usually 30 days or less for short-term disability policies and 90 days or more for long-term policies.

Definition of disability

When deciding on a disability insurance provider, it’s essential to know how the company defines “disability.” The criteria for determining whether an individual is eligible to receive benefit payments due to illness or injury vary depending on the insurance policy and the provider offering it.

Some disability insurance policies are any-occupation policies. With an any-occupation policy, if you are hurt or sick and cannot perform the tasks of your regular job but can still work a different one, you won’t be eligible for benefit payments, even if your new job pays less than what you earned before.

Own-occupation policies, on the other hand, will pay benefits if you cannot perform the duties of your current occupation due to sickness or injury, even if you could work in a different role or field.

Some carriers also cover partial disabilities if you aren’t completely disabled but still can’t perform your job. Partial disability insurance usually provides partial benefit payments.

How to choose a disability insurance provider

Finding the right insurance provider for your situation will take some work. This article can help you get started, but you should do your own research into the companies and policies available.

Before buying a policy, make sure you know exactly what coverage you’ll receive and how your provider will assist you financially if you can’t work. All disability insurance policies are different, so look at the five basic elements of a policy mentioned above before purchasing one. Also make sure you understand how any additional insurance riders affect your coverage.

Remember to check the cancellation options on your policy

Some policies are non-cancellable, meaning your insurance provider can’t cancel your policy for any reason other than a policy lapse (failure to pay your monthly premiums), regardless of the injury or illness you experience.

Guaranteed renewable policies, on the other hand, ensure that you can renew your policy without any changes, but they don’t necessarily guarantee that your premium will remain the same.

There are also non-cancellable, guaranteed renewable policies, where your provider cannot modify the policy provision, increase your premiums or cancel your policy, assuming you keep up with premium payments.

Disability Insurance FAQ

How much does disability insurance cost?

There isn’t a set cost for disability insurance, but you can expect to pay between 1% and 3% of your annual income for coverage. Like most other insurance policies, the price of disability insurance will vary depending on multiple factors, including:

Short- or long-term policy type Coverage amount Your occupation Your age Your gender Insurance riders In some cases, your health will also play a role in the price you pay. For example, smokers will pay a higher premium than non-smokers due to their higher risk of smoking-related illness.

What does disability insurance not cover?

Disability insurance provides coverage for lost income due to most injuries or illnesses. However, it does not cover injuries or illness resulting from self-harm, war, military service or criminal activity. Disability insurance also won’t cover long-term care or medical bills.

How do long-term disability and short-term disability insurance differ?

As the names suggest, the main difference between short- and long-term disability insurance is in the length of coverage.

Short-term disability insurance covers serious but temporary injuries and illnesses that cause you to miss work for a few weeks to several months (typically no longer than a year). Long-term disability insurance provides income replacement if an injury or illness causes you to miss work for a more significant period, such as several years or until retirement age.

Long-term disability insurance premiums cost more than short-term disability insurance premiums as the benefit periods extend longer.

Is long-term care insurance the same as long-term disability insurance?

Long-term care insurance covers the cost of your daily care needs over an extended period of time during old age or after a serious illness. For example, long-term care insurance covers in-home care or residence at an assisted living facility or nursing home.

Long-term disability insurance, on the other hand, offers income replacement when an illness or injury causes you to miss work.

How We Chose the Best Disability Insurance

To determine the best disability insurance providers, we weighed factors including:

• Application requirements

• Coverage offerings

• Insurance riders

• Maximum benefit payouts

• Benefit and waiting periods

• Available discounts

• Financial stability

• Customer service reputation

We also looked at third-party review sites like AM Best and the Better Business Bureau to consider customer reviews and complaints.

Summary of Money’s Best Disability Insurance

• Guardian – Best for Long-Term Disability Coverage

• State Farm – Best for Short-Term Disability Coverage

• Assurity – Best for High-Risk Occupations

• Mutual of Omaha – Best for Short Waiting Period

• Breeze – Best for Affordable Insurance Premiums

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