Why disability insurance
Direct answer
For most high earners, future income is the largest asset they own, and the one least likely to be insured properly. Disability insurance replaces part of that income if illness or injury stops you from working in your field. The question is not whether to have it, but how much, under what definition, and from whom.
The evidence
Each figure links to its primary source. We update them when the source does.
1 in 4
Roughly one in four of today’s 20-year-olds will experience a disability before reaching retirement age.
Source: Social Security Administration, Disability and Death Probability Tables, 2023
90%
About nine in ten long-term disability claims are caused by illness, not accidents. Musculoskeletal disorders and cancer lead.
Source: Council for Disability Awareness, Long-Term Disability Claims Review
34.6 mo
The average long-term disability claim lasts nearly three years.
Source: Council for Disability Awareness, Long-Term Disability Claims Review
60%
A typical employer plan replaces 60% of base salary, capped monthly, taxable when employer paid, and not portable.
Source: Bureau of Labor Statistics, National Compensation Survey, 2024
Your career is the asset
A 35-year-old earning $350,000 will earn roughly $18 million before 67 with modest raises. Most people insure their house, car, and life, and leave the $18 million uninsured or covered by a capped employer plan they have never read.
Use the calculator to see your own figure, then check how much of it your current plan would replace.
Lifetime earnings estimate
Enter an age from 18 to 67.
Estimated earnings to age 67
$18.4 million
Assumes 3% annual raises. Illustration only.
Five things people get wrong
| Assumption | What the contract says |
|---|---|
My hospital plan covers me. |
It covers 60% of base salary up to a cap, usually $10,000 to $15,000, before tax. Bonus and call pay are rarely counted. It ends when you leave. |
Social Security will pay if I really cannot work. |
SSDI requires inability to do any substantial work, pays a maximum near $3,800 per month in 2026, and denies most first applications. |
I am healthy, so I can wait. |
Premiums rise with age and any diagnosis can add an exclusion or a decline. The cheapest policy you will ever buy is the one you buy this year. |
All own-occupation policies are the same. |
Some stop paying when you take other work. Some switch to any-occupation after 24 months. The difference is in one sentence of the contract. |
An advisor will push the most expensive option. |
Prices are set by carriers and are identical whether you buy direct or through an independent advisor. Compensation is disclosed on this site. |
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