Disability Income Insurance
Your income is your biggest asset. Protect it.
If illness or injury kept you from working, how long could you pay the bills? Disability income insurance replaces a portion of your paycheck so a health setback doesn't become a financial collapse.
The Basics
What is disability income insurance?
Disability income (DI) insurance pays you a monthly benefit if you become unable to work due to a qualifying illness or injury. It replaces a percentage of your income — typically 50% to 70% — so you can keep covering your mortgage, groceries, and everyday expenses while you can't earn.
Most people insure their home and their life but overlook the asset that pays for everything else: their ability to earn a living. A 35-year-old earning $75,000 will bring in roughly $3 million over their career. Statistically, a working-age adult is far more likely to experience a disabling condition lasting months than to die during their working years.
Coverage comes in two broad flavors: short-term disability (covers a few weeks to months, often employer-provided) and long-term disability (covers years or to retirement age). Many people have some group LTD through work but discover it covers less than they assumed, or disappears if they change jobs.
The Process
How it works, start to finish
DI underwriting looks closely at your occupation and income, so the conversation matters more than with life insurance.
Review what you have
We check any group coverage through your employer and identify the gap an individual policy should fill.
Design the policy
Benefit amount, waiting period, benefit period, and definition of disability — these levers shape both protection and cost.
Apply & underwrite
Underwriting reviews your occupation, income, and health. Income documentation is typically required.
Coverage in force
Once issued, your income is protected. Benefits are designed to coordinate with any group coverage you have.
Who Needs It
Who disability coverage fits best
If you depend on your income and don't have substantial savings to replace it for years, this is for you.
Primary earners
If your household depends on your paycheck to function, losing it for months is a serious risk.
Self-employed & contractors
No employer disability plan, no sick leave — an individual policy is often the only safety net.
Specialized professionals
Surgeons, dentists, and skilled trades whose income depends on specific physical or cognitive abilities.
People with a mortgage
A disability doesn't pause your mortgage. DI keeps the roof over your head while you recover.
Single-income households
With no second earner to fall back on, income protection is even more critical.
Thin emergency savings
If you couldn't cover six-plus months of expenses from savings, DI bridges the gap.
Key Policy Features
The levers that define a DI policy
These four choices determine both how well you're protected and what you'll pay.
| Feature | What it means |
|---|---|
| Elimination period | The waiting time between becoming disabled and benefits starting (commonly 30, 60, 90, or 180 days). Longer waits lower the premium. |
| Benefit period | How long benefits pay — 2 years, 5 years, or to age 65/67. Longer periods cost more but protect against permanent disability. |
| Definition of disability | "Own-occupation" pays if you can't do your specific job; "any-occupation" only pays if you can't do any job. Own-occ is stronger and pricier. |
| Benefit amount | Usually capped around 50–70% of income. Benefits from individually-paid policies are typically received tax-free. |
Common Questions
Disability insurance FAQ
Doesn't my employer's coverage handle this?
Maybe partly. Group long-term disability often replaces only ~60% of base salary (not bonus/commission), is taxable if the employer paid premiums, and vanishes if you leave the job. Many people supplement group coverage with an individual policy that's portable and fills the gap. We'll review what you have before recommending anything.
What's the difference between own-occupation and any-occupation?
This is the single most important DI provision. "Own-occupation" pays benefits if you can't perform your specific occupation, even if you could do some other job. "Any-occupation" only pays if you can't do any job you're reasonably suited for. Own-occ is far more protective — critical for specialized professionals — and costs more.
How much does disability insurance cost?
As a rough range, individual long-term DI often runs 1–3% of your annual income per year, varying widely by age, occupation class, health, and the policy features you choose (elimination period, benefit period, own-occ vs any-occ). We'll compare quotes across carriers so you see real numbers for your situation.
Are disability benefits taxable?
It depends who paid the premiums. Benefits from a policy you paid for with after-tax dollars are generally received tax-free. Benefits from an employer-paid plan are typically taxable. This is one reason an individually-owned policy can be more valuable than it first appears — a tax-free benefit goes further.
What conditions actually qualify as a disability?
It's defined by the policy, not by a list of conditions. The majority of long-term disability claims come from things like musculoskeletal disorders, cancer, cardiovascular issues, and mental health conditions — not dramatic accidents. What matters is whether the condition prevents you from working under your policy's definition of disability.
Free Tool
What's your income gap?
Use our free Disability Income Gap Calculator to estimate the monthly shortfall an individual policy might cover. Educational only, not a quote.
Find out what protecting your income would cost
We'll review any coverage you already have and compare individual policies across carriers. Free, no obligation, and tailored to your occupation and goals.
Get my disability quote