Best Disability Insurance Companies

How to choose the right disability insurance for you

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People without adequate disability insurance coverage risk financial hardship if they cannot work because of a medical condition. With almost 70% of Americans having less than $1000 in savings, plus the rising cost of health care, many employees would be devastated if they were to experience disability, even temporarily.

Disability insurance affords financial security by replacing some or all of your earned income if an injury or illness prevents you from working. Insurance companies also call this form of insurance disability income insurance, income protection, or abbreviation DI. The benefit amount you receive is usually a percentage of your working income. The coverage may extend for a certain number of months or years or until you reach a specified age.

The term "disability" isn’t limited to severe, life-altering conditions following an accident or illness. It can also include musculoskeletal issues and pregnancies. The range of disabilities that can prevent you from working and earning an income is broader than you may realize, and taking out disability insurance is wise protection.

To help those who are shopping around for disability insurance, we explored over a dozen policies and focused on factors like price, availability, coverage limits, and the length of time required before benefits are available. Keep reading to see what made the list of our best disability insurance coverage.

5 Best Disability Insurance Companies of 2021

Best Disability Insurance Companies
Best Disability Insurance Companies

Best Overall : Northwestern Mutual


Northwestern Mutual

Northwestern Mutual

Why We Chose It: We chose Northwestern Mutual for our overall disability insurance pick because they are the largest seller in the United States, and S&P Global Market Intelligence ranked them as number one.

What We Like
  • Coverage for stay-at-home parents

  • Additional coverage for high-earners

  • Financially stable company

  • Achieved maximum score on the Disability Equality Index

  • Received high ranking in the J.D. Power customer satisfaction survey

What We Don't Like
  • Slightly higher average premiums for females

  • Can’t buy or get a quote online

  • Must use a local agent who earns a commission

Northwestern Mutual holds an A++ rating from AM Best and has been around since 1857, making it a sound choice for our number-one long-term disability insurance. They also hold the highest rating of A+ from the Better Business Bureau (BBB).

The company also received a perfect score on the Disability Equality Index administered by the American Association of People with Disabilities. Although the report assesses company performance for disability inclusion policies and practices, rather than for their insurance offerings, it highlights Northwestern Mutual’s commitment to and understanding of disabilities.

Northwestern Mutual offers higher premium options with more generous benefits. They have four alternative definitions of total disability and have partial disability coverage options if someone can only work part-time.

The short-term policies cover illnesses, injuries, and pregnancy that a doctor confirms would prevent you from doing your normal work, like heart attacks, broken bones, bad sprains, or surgeries with a short recovery time.

Long-term benefits begin after 90 days and pay up to 65% of the salary, which maxes out at $12,000 per month for typical policies. Disability coverage has maximum benefit period and generally lasts until a certain age, depending on the policy, usually 65, 67 or 70. Renewability depends on the policy, and you can purchase different renewable options.

Coverage is available across the United States. To purchase a policy, enter your details on the website, and you will then be connected with a local insurance agent.  

Northwestern sells short- and long-term disability income and long-term care insurance. Offerings include specialized coverage for doctors and dentists and stay-at-home parents.

Not many carriers have these options, further setting Northwestern Mutual above competitors.

Best Budget : Breeze


Breeze

Breeze 

Why We Chose It: Breeze is the best budget choice because their plans begin at just $9  per month, which is extremely affordable compared to some of the other plans on our list.

What We Like
  • Affordable

  • Online quote system

  • Write your policy in under 15 minutes

What We Don't Like
  • Newcomer to the market

  • Only sells long-term disability insurance

  • Unavailable in New York state

Breeze is our budget top-pick because of their economical price tags with policies from $9 per month. They are underwritten by Assurity Life Insurance Company which has an A- rating with AM Best, and already have an A+ rating with the Better Business Bureau.

Buying a policy is a breeze. You can get a quote and complete the online application process in less than 20 minutes; no insurance agent is necessary. 

Breeze offers policies countrywide, except for the state of New York. Elimination or waiting periods vary, and policies are guaranteed renewable through age 65 or 67.

Most people under 50 don’t need a medical exam unless they earn more than $4,000 per month. Coverage maxes out at $20,000 per month, with benefit periods varying by the policy.

Breeze sells long-term disability insurance with supplemental options for critical illnesses, catastrophic disability, and more. They won’t cover pre-existing conditions or certain occupations, including the armed forces, pilots, and students.

Breeze pride themselves on customer service, low prices, and efficient online quotes.

Best Short-Term Disability Insurance : Mutual of Omaha


Mutual of Omaha

Mutual of Omaha

Why We Chose It: Mutual of Omaha offers flexibility, and shorter waiting times, making it the ideal choice for our short-term disability insurance choice.

What We Like
  • Online quotes available

  • Waiting periods from 0 days

  • Policies can be customized

What We Don't Like
  • Must use an agent to buy policies

  • Benefits max out at $5000 per month

  • High monthly premiums up to $124 for $1,000 a monthly.

With an A+ rating from AM Best, Mutual of Omaha is named our top short-term disability insurance because it covers from day one of a disability and has a benefit period of up to 70 years of age. 

Coverage extends to $12,000 per month depending on your salary, and plans have an elimination period of 0 to 90 days. Plans are guaranteed renewable until age 67.

Besides short-term disability insurance, Mutual of Omaha provides long-term disability and accident-only insurance. They offer plans across the entire United States, but people must buy plans from an agent, even though they can quote their plan online.

Mutual of Omaha’s short-term disability policies dominate the competition with valuable included benefits, such as partial disability benefit, waiver of premiums for people disabled for 90 days or more, and guaranteed renewable status.

Best Long-Term Disability Insurance : Guardian


Guardian

Guardian 

Why We Chose It: Guardian is our top-pick for long-term disability insurance as they offer a range of optional riders for genuinely personalized coverage.

What We Like
  • Online quotes widely available

  • Choose from several riders, including student loan payment protection

  • Supplemental disability insurance available with no medical exam

What We Don't Like
  • Can be expensive for some manual occupations

  • Must use an agent to finalize and purchase policies

  • Group disability insurance coverage maxes out at 60%

Guardian Life provides countrywide coverage and is underwritten through the Berkshire Life Insurance Company of America, which has an A++ rating from AM Best. It’s named our top long-term disability insurance as it offers its own occupation coverage. This means it covers a portion of your income if you can’t do your regular job but would be deemed able to do other work forms. 

They offer long- and short-term disability policies plus supplemental coverage, with some form of coverage available countrywide.

The premiums are not the cheapest. For example, a female 30-year old teacher living in California earning $50,000 would pay $128 monthly for $3000 of benefits, with an elimination period of 90 days. Plans are guaranteed renewable until age 65 or 70 under specific policies and conditions. You must contact an agent to purchase.

Best For Risky Occupation Fields : Assurity


Assurity

 Assurity

Why We Chose It: We chose Assurity as best for risky occupations as they offer affordable cover for professionals, from electricians to machine operators, both full-time and self-employed.

What We Like
  • Reputable company

  • Online quotes available

  • Cover for most high-risk occupations

What We Don't Like
  • Must use an agent or employer to purchase policies

  • Uses traditional underwriting, which can be slow

  • Non-cancelable rider available, but not available in Florida or Massachusetts

People working in high-risk occupations can find it challenging to buy disability insurance. However, Assurity, with its A- financial rating from AM Best, is named our top risky occupations insurance. It extends affordable cover to those working with construction, heavy machinery, brick layer, electrical installations, along with self-employed individuals.

Using their online quotation system, we found that a 40-year-old male located in Texas who works in the labor occupation class earning $3,400 a month would pay $87.81 a month for $2,480 monthly coverage for a five year benefit period. You’ll need an insurance agent to purchase.

Policies have elimination periods of 30, 60, 90, 180, or 365 days and include up to $20,000 in total benefits, making their plans ideal for higher earners. Plans are guaranteed renewable until age 67. 

Assurity offers short and long-term disability insurance options, although access to all features may be limited in some states.

Compare Providers

Note

These average monthly premium costs are meant to provide an estimate of what you could potentially be paying month to month. Disability insurance rates are influenced by various factors including your own individual income and occupation. The below rates may look different for you depending on these factors.

Insurance Provider Why We Picked it Average Monthly Premium
Northwestern Mutual Best Overall $122.39
Breeze Best Budget $9
Mutual of Omaha Best Short-Term Disability Insurance $93.90
Guardian Best Long-Term Disability Insurance $137
Assurity Best For Risky Occupation  $94.01

Final Verdict

Your insurance needs dictate which provider is best for you. For those working in risky occupations, choices are limited, but Assurity is an excellent option. If the expense is an overriding concern, newcomer Breeze provides excellent coverage for the price. 

Mutual of Omaha, with its zero wait time policies, make a sound investment for short-term disability cover. In contrast, Guardian rules the long-term disability insurance category because of their range of additional options. 

Overall, our top pick is Northwestern Mutual for best overall disability insurance as they are consistently placed first in industry rankings.

FAQs

What Is Disability Insurance?

Disability insurance covers a portion of an employed person’s income if they can’t work because of an illness or injury. It doesn’t just cover accidents that leave someone unable to walk but also issues like heart attacks, musculoskeletal disorders, cancer, and even pregnancies. In other words, these are common health concerns that could happen to anyone, anytime.

Private insurance companies offer short-term disability insurance and long-term disability insurance. The federal government also provides free Social Security Disability Insurance (SSDI) to people with severe disabilities. However, it is difficult to qualify for, and most people find a private policy a better option.

Do You Need Short-Term Or Long-Term Disability Insurance?

Short-term disability insurance is designed to cover you immediately after a serious illness or injury. The benefits ordinarily begin one or two weeks following a qualifying event, last between three and six months, and pay up to 80% of someone’s gross monthly income. Employers often provide short-term disability insurance as part of a benefits package, and because it’s tied to the employer, you would lose coverage if you left the job.

Long-term disability insurance replaces up to 70% of gross income if someone’s condition prevents them from working longer-term or beyond the end of their short-term disability insurance benefit period. People can apply for payments that last for two, five, 10 or 20 years, or until they reach retirement age. 

Long-term disability insurance has a longer elimination period, which is how long you must wait before receiving benefits. The elimination period varies by policy and can range from 90 days to one year. 

Ideally, you should have both short-term and long-term disability insurance. With both policies in place, you’re financially protected almost immediately in the event of an unexpected health problem and for several years or more into the future. 

Should You Get Disability Insurance?

Consider what would happen to you and your family if you were hurt and couldn’t go to work tomorrow. Do you have savings or other insurance that could cover you? Your circumstances dictate to some extent whether or not you should get disability insurance. 

If you can afford it, and especially if you’re the family’s primary income earner, it’s worthwhile to have the peace of mind that some of your income is protected.

However, you should also think about your specific occupation. If you’re someone who works standing, even a sprained ankle could prevent you from working. If, however, you’re someone who works from home, at a computer, there’s a considerably smaller chance you could be disabled to the extent you couldn’t work at all.

How Much Does Disability Insurance Cost?

The monthly premium for disability insurance ranges from 1% to 3% of their gross annual income. If you make $30,000 a year, you could be paying around $300 to $900 annually, or $25 to $75 each month. 

Long-term policies with extended elimination periods are less expensive than short-term policies that pay out almost immediately. Plans with strict qualifying criteria for disabilities typically cost less than more generous plans.

Factors such as age, occupation, and if you smoke can also affect the cost of a policy. 

What Is Excluded From Coverage?

Pre-existing health conditions may exclude you from coverage. This means that if you become ill or disabled and cannot work and earn an income, your insurance plan could deny coverage if an excluded health condition causes the disability.

How We Chose the Best Disability Insurance Companies

We analyzed 12 insurance companies before deciding on our picks for each of the five categories. We considered factors that included the plans offered, options, premium costs, how quickly coverage would begin, how simple it was to get a quote, and the ease of purchasing a policy.

Because a solid history of client satisfaction and financial stability are essential, we also reviewed data from the NAIC, BBB, and AM Best before determining the best disability insurance providers.

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Article Sources
Verywell Health uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. GOBankingRates. Survey: 69% of Americans have less than $1,000 in savings. Updated December 16, 2019.

  2. S&P Global Market Intelligence. Northwestern Mutual Stays atop US Life Insurance Rankings in Q1'20. Updated June 23, 2020.

  3. AM Best. AM Best affirms credit ratings of The Northwestern Mutual Life Insurance Company and its subsidiary. Updated May 6, 2021.

  4. Better Business Bureau. Northwestern Mutual.

  5. Disability Equality Index. 2020 DEI Report.

  6. AM Best. Assurity Life Insurance Company. Updated January 24, 2019.

  7. Better Business Bureau. Assurity Life Insurance Company.

  8. AM Best. AM Best affirms credit ratings of Mutual of Omaha Insurance Company and its subsidiaries. Updated January 20, 2021.

  9. AM Best. Guardian Life. Updated November 12, 2020.

  10. Policygenius. How Much Does Long-Term Disability Insurance Cost? Updated March 16, 2018.