Disability insurance takes 5 things into consideration when pricing your plan
1) How big is your monthly benefit?
- The amount you pay is proportional to the amount you would receive if you became disabled.
- The bigger the disability plan’s benefit amount is, the more expensive the plan’s premiums are.
2) How long will you get paid for?
- A longer benefit period means that your premiums will cost more.
- If you choose a longer benefit period, you’ll be paid more overtime. The length of your benefit period could be anywhere from 1 year to until you turn 65.
3) How long after are disabled will you start receiving your benefit?
- The length of your elimination period is inversely proportional to your plan’s price.
- The elimination period gives you the chance to heal before claiming your benefits, which drives down the cost of your plan!
4) How safe is your work?
- This component of the your plan’s pricing takes into account your job and your health history. It also considers your age, gender, and the likelihood of a disability in the years you have left working.
- If you work in a more hazardous career, like construction or Uber driving, you will have higher priced plans because it is more likely to be injured and become disabled.
5) How healthy are you?
- If you have a personal or family history of chronic health problems, such as diabetes or cancer, your disability plan will be more expensive because it is more likely that you will experience a permanent disability.
- Your gender also plays a role in determining risk of disability related to health and propensity for disabling events.
Stride sells disability insurance starting at $20 a month. Sign up and find out what your monthly premium would be!
In summary, the following relationships are true for Disability Insurance pricing: