Data from LIMRA’s 2018 Insurance Barometer shows that roughly 3 in 5 American households have some form of life insurance.
In other words, there’s a good chance you have — at minimum — a term life insurance policy and therefore have some experience choosing a life insurance policy that fits your financial needs and life goals.
It’s far less likely you have experience searching for another type of insurance you probably need. That would be disability insurance, a vital income replacement solution for workers unable to work productively due to serious injury or illness.
Best Disability Insurance Companies
If you or your family rely on your employment income to make ends meet or support a lifestyle you’ve become accustomed to, disability insurance is nearly as important as life insurance. After all, not all life-altering accidents and illnesses result in death.
And not all life-altering events that qualify for disability coverage are tragic. According to internal data from the Guardian Life Insurance Company of America, new mothers make more than one-quarter of the company’s short-term disability insurance claims.
Tips to Find the Best Disability Insurance Policies
Obtaining a disability insurance policy isn’t all that different from obtaining a life insurance policy. And many of the best life insurance companies also write disability insurance policies, so you’ll see plenty of familiar names along the way.
Always shop for insurance using an aggregator like Policygenius. But the following disability insurance providers, in particular, are among the best for U.S.-based workers.
There are two main types of disability insurance coverage: short-term disability and long-term disability. All of the companies on this list offer long-term disability coverage, some offer short-term disability insurance, and many of them (or their close affiliates) offer other insurance products, such as term life and annuities.
This evaluation incorporates:
- Financial strength ratings from A.M. Best, which measures insurers’ financial stability and overall capacity to make promised benefit payouts
- Customer satisfaction ratings from the Better Business Bureau (BBB), a leading evaluator of general business quality
- Overall suitability based on each company’s product mix, strengths, weaknesses, and markets served
When evaluating disability insurance companies and policies, pay close attention to policy specifics like:
- The length of the elimination period (the waiting period before benefits kick in) for short-term policies and long-term policies (as they’re often different)
- The length of the benefit period itself (which is usually longer for long-term policies)
- The monthly benefit amount
- Actual disability insurance costs (monthly premiums)
- Whether the policy offers “any occupation” or “own occupation” coverage (or both)
- Whether the policy offers annual cost of living adjustments to keep pace with inflation (and if so, how much)
- Whether the company offers individual disability insurance policies, group disability policies, or both
- The disability claim filing process, which can vary significantly by insurer
1. Breeze Financial & Insurance Services Group
A.M. Best Financial Strength Rating: Not available- BBB Customer Satisfaction Rating: A+
- Great For: Very affordable policies; 100% online process with no salespeople
Breeze offers short- and long-term disability solutions that are all about convenience and affordability. Its 100% online application process cuts traditional salespeople out of the equation, allowing would-be policyholders to focus on what matters most: finding and securing the right amount of disability coverage at the right price.
Young, healthy workers with low coverage needs qualify for long-term coverage for as little as $9 per month — significantly less than many mainline insurers charge. That alone makes Breeze one of the best long-term disability insurance providers around.
Despite its technology-driven approach, Breeze prides itself on an unusually transparent process that walks applicants through the entire scope of coverage and can accommodate a range of nontraditional situations, including solopreneurs and small-business owners with complex insurance needs.
And Breeze offers low-risk applicants an instant approval option that waives the usual medical underwriting requirement — no invasive medical exams or time-consuming labs required.
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2. Northwestern Mutual
A.M. Best Financial Strength Rating: A++ (Superior)- BBB Customer Satisfaction Rating: A+
- Great For: Supplementing employer-sponsored disability plans; specialized plans for part-time workers and stay-at-home parents
Northwestern Mutual specializes in long-term disability plans with variable-length elimination periods that bridge the coverage gap between what employer-sponsored disability plans pay and policyholders’ pre-disability income.
But traditional employees with existing disability coverage aren’t the only folks Northwestern Mutual’s worthwhile for. The company also offers nontraditional products and add-ons for part-time workers and stay-at-home parents whose emotional labor is so often undervalued.
Plus, it’s regarded as one of the strongest insurance companies on the market, which is no small thing for those seeking peace of mind.
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3. MassMutual
A.M. Best Financial Strength Rating: A++ (Superior)- BBB Customer Satisfaction Rating: B-
- Great For: Retirement savings protection; tying benefit growth to salary
MassMutual’s customizable disability insurance products protect between 45% and 65% of policyholders’ pre-disability income, but that’s far from the whole story.
Powerful riders, some of which aren’t widely available elsewhere, help policyholders keep their financial plans on track, even as they pay into their policies or (if it comes to that) collect benefits.
For example, the retirement savings protection rider earmarks some income for policyholders’ retirement plans, keeping their long-term investment strategy on track when they’re temporarily unable to work.
Another rider pegs benefit growth to salary growth, adding protection as policyholders’ careers advance.
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4. Guardian Life Insurance Company of America
A.M. Best Financial Strength Rating: A++ (Superior)- BBB Customer Satisfaction Rating: A+
- Great For: Coverage for self-employed workers; group plans for small employers
Guardian Life Insurance Company of America offers short- and long-term disability insurance for self-employed individuals, group plans for employers, and supplemental policies for workers looking to add to their employer-sponsored coverage.
Because its policies are only available through licensed insurance brokers or employers themselves, Guardian requires all would-be policyholders to go through a middleman and definitely caters to small-business owners and executives looking to retain employees with attractive disability coverage.
But it’s a solid choice for self-employed workers with variable income, a group that tends to be perceived as high-risk (and is therefore underserved) by most disability insurance providers.
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5. Principal Financial Group
A.M. Best Financial Strength Rating: Not rated- BBB Customer Satisfaction Rating: A+
- Great For: Existing Principal Financial clients and those willing to work with a Principal advisor
Like Guardian’s, Principal Financial Group’s disability insurance offering is gated, available only to clients of Principal Financial Group advisors and those willing to establish an advisory relationship (even if temporary) to obtain disability coverage.
The advantage: All Principal policies are written for individuals, not employers, and are therefore portable, meaning they remain in force when the policyholder changes jobs.
Because Principal clients’ relationships extend well beyond disability insurance, they can sometimes qualify for lower premiums than those available through one-off individual policy transactions. However, the most critical factor in any pricing decision is the perceived risk of disability.
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6. RiverSource Life Insurance Company
A.M. Best Financial Strength Rating: A+ (Superior)- BBB Customer Satisfaction Rating: A+
- Great For: Option to tie benefits to salary; potential for high coverage limits
RiverSource Life Insurance Company offers two disability insurance solutions: Income Protection and Income Protection Plus.
The main difference between the two is a higher level of coverage with the latter, though both are customizable based on policyholders’ incomes and long-term goals.
And both come with optional riders that tie benefits to salary increases, ensuring peace of mind with every raise. Like Guardian and Principal, RiverSource offers disability policies through a network of advisors — in this case, those working with Ameriprise Financial.
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7. Mutual of Omaha Insurance Company
A.M. Best Financial Strength Rating: A+ (Superior)- BBB Customer Satisfaction Rating: A+
- Great For: High coverage limits, optional coverage until age 67
Mutual of Omaha Insurance Company’s long-term disability insurance offering has two distinct advantages: high coverage limits (up to $12,000 per month) and the option to extend coverage until age 67, two years past the usual cutoff date for long-term disability benefits.
If you continue to work full-time and pay your premiums, your policy could remain in force until age 75, but Mutual of Omaha reserves the right to cancel your policy at any time after age 67.
The main drawback here: As with some competitors, individual Mutual of Omaha disability insurance policies are only available through licensed agents.
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8. Assurity
- A.M. Best Financial Strength Rating: A- (Excellent)
- BBB Customer Satisfaction Rating: A+
- Great For: Longer coverage periods, flexible benefit amounts (including total disability coverage)
Assurity is a flexible option for workers with longer-term disability income insurance needs. Its coverage periods start at one year and continue up until retirement age.
Customizable benefit amounts range from partial disability (for those transitioning back to the workforce) to total disability coverage for policyholders unable to work at all.
Assurity also stands out for its commitment to any occupation coverage. Even if you’re able to perform some duties in a role or profession other than the one you held before your disability, you can remain out of the workforce (and earning benefits) until you’re once more able to do the job you were trained for.
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Final Word
Health insurance is a prevalent employment benefit. And it’s a valuable one — so much so that many workers accelerate or delay job changes based on the availability or absence of quality, affordable employer-sponsored health insurance.
Employer-sponsored disability insurance isn’t offered as widely and isn’t as high on workers’ must-have lists as health insurance. But it’s still a fairly common employment benefit. If you’re not sure whether your employer offers it, dig up your new-hire packet or log into your HR portal to see for yourself.
If it’s an option, investigate further. It could be a better deal than what’s available on the individual market to someone in your risk class.
Then again, it might not be, which is why it always pays to shop around.