Having long-term disability insurance is a vital part of financial planning. According to the Social Security Administration, if you were 20 years old in 2023, you had a 25% chance of becoming disabled before retirement. Disability insurance can help replace lost income during a period of inability to work.
To help you choose the right policy, Investopedia evaluated 11 insurance providers, considering factors such as cost, coverage availability, and financial strength. Here’s what we found:
Best Long-Term Disability Insurance Companies
- Best Overall: MassMutual
- Most Affordable: Thrivent
- Also Great for Affordability: Assurity
- Best for Financial Strength: State Farm
- Best for Customization Options: Principal
- Best for High Earners: The Standard
MassMutual
Investopedia’s Rating: 4.8
MassMutual stands out for its comprehensive long-term disability coverage, providing a high level of income replacement, lengthy coverage periods, and a wide range of customization options.
Why We Chose It: MassMutual’s policies can replace up to 80% of your income, and offer coverage that lasts until age 70, providing financial security for the long term. With a wide selection of optional add-ons, you can tailor your policy to meet your specific needs.
Pros:
- High maximum percentage of income covered
- Policies issued up to age 64, with coverage up to 70
- Good rider selection
Cons:
- Waiting period for payouts is 60 days. If you want faster financial relief, Principal and State Farm both offer a 30-day elimination period.
Overview: MassMutual could be a solid choice for long-term disability insurance. Its policies can cover up to 80% of your income. You can secure coverage lasting until age 70, providing long-range financial security. A married couple can receive a 10% discount.
Important Note: The elimination period is the time you must wait between becoming ill or injured and when your insurance start paying benefits.
MassMutual was founded in 1851 and is based in Springfield, Massachusetts.
Thrivent
Investopedia’s Rating: 3.0
Thrivent is a very cost-effective option for long-term disability insurance, especially if you are looking for a shorter waiting period before the beginning of benefits. However, to become a member, you must be Christian or the spouse of a Christian.
Why We Chose It: Thrivent is a low-cost option for disability insurance. They also have a 30-day elimination period, which means benefits begin a bit earlier than from some other companies.
Pros:
- Low premium quotes
- 30-day elimination period available
Cons:
- Membership is only open to Christians or their spouses
- Max percentage of income covered is 70%
- One of the lowest maximum monthly benefits
Overview: Thrivent has some of the lowest disability insurance premiums, based on sample quotes collected for a 40-year-old dentist with coverage up to age 67. If you stay at home to care for people, Thrivent offers up to $2,000-per-month coverage for as long as 24 months. Their income coverage caps out at 70%, while competitors like MassMutual and State Farm offer as much as 80%. In comparison to other companies that Investopedia reviewed, Thrivent’s monthly benefit is one of the lowest.
Thrivent was founded in 1902 and is based in Minneapolis.
Assurity
Investopedia’s Rating: 3.3
Assurity provides affordable long-term disability insurance. Another budget-friendly option for long-term disability coverage.
Why We Chose It: Assurity provides lower long-term disability premiums and offers a 30-day elimination period, allowing quicker benefits access.
Pros:
- Low long-term disability premiums
- 30-day elimination period available
Cons:
- Competitors have more riders
- Poor maximum monthly benefit compared to competitors
Overview: A 40-year-old dentist with a $100,000 salary can expect to pay about $232 a month for coverage up to age 67, less than most similar companies. However, the maximum monthly benefit is $20,000, which is lower than competitors like The Standard.
Assurity was founded in 1890 and is based in Lincoln, Nebraska.
State Farm
Investopedia’s Rating: 3.8
State Farm offers financially strong, affordable long-term disability coverage that replaces income at a high proportion. State Farm’s coverage can replace up to 80% of your income.
Why We Chose It: State Farm earned high ratings for financial strength, and can be depended on to pay out in the future.
Pros:
- Low long-term disability insurance premiums
- Replaces up to 80% of income
- Benefits can pay out after 30-day waiting period
Cons:
- Low maximum monthly benefit compared to competitors
- Limited rider selection
Overview: State Farm is a strong option for stable long-term disability insurance and competitive rates. State Farm’s financial strength means it should be reliable for paying out disability claims. You can choose a 30-day waiting period, which means you could begin to receive benefits in just one month after becoming disabled.
Note: AM Best, a credit rating agency, rates companies on their financial strength. State Farm received AM Best’s highest possible rating.
State Farm was founded in 1922 and is based in Bloomington, Illinois.
Principal
Investopedia’s Rating: 3.9
Principal offers a strong, customizable long-term disability policy that perfectly fits your needs for flexible waiting periods and rider options.
Why We Chose It: Principal offers a wide range of elimination periods (30, 60, 90, 180, and 365 days).
Pros:
- 30-day elimination period available
- Good rider selection
Cons:
- Policies only issued up to age 60
- Relatively high premiums
Overview: Principal’s policies are flexible and let you fine-tune when benefits begin, potentially saving money. Principal also offers a wide selection of riders. You can get disability insurance that’s specialized for retirement savings.
Principal was founded in 1879 and is based in Des Moines, Iowa.
The Standard
Investopedia’s Rating: 3.3
The Standard offers substantial long-term disability coverage, which might be ideal if you have a comparatively high income.
Why We Chose It: The Standard has a high monthly maximum benefit.
Pros:
- $35,000 maximum monthly benefit
- People can apply up to age 64
Cons:
- Minimum waiting period for benefits is 60 days
- No online quotes
Overview: The Standard offers a high maximum monthly benefit and accepts applications up to age 64. They offer a Family Care Benefit to help when you need to cut your work hours to care for a family member.
The Standard was founded in 1906 as Oregon Life Insurance Company and is based in Portland, Oregon.
Why You Should Trust Us
Investopedia’s reviews are based on thorough research by experienced staff. Data was gathered on 11 different providers, weighing factors like maximums, riders, and premiums. Investopedia was founded in 1999 and has reviewed disability insurance companies since 2020.
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