Some policies will cost more than others. Sometimes this is because the policy has a broader definition of disability or has more bells and whistles, but other times, it is simply a reflection of your state, specialty, gender, or health status. Be aware that a cheaper policy with fewer bells and whistles is not necessarily worse for you. The premium saved could be used to invest, pay down debt, or even purchase a larger amount of coverage rather than less coverage with more features.

Step 5

Now that you have all the information you need, you can make a rational decision about which policy to purchase and which riders (policy additions) to pay for. A group policy is generally much cheaper than a solid individual policy, but it often comes with a weaker definition of disability and cannot be taken with you when you change employers. A group policy, however, may be a much better deal (or the only policy available) for a doctor with health issues or dangerous hobbies such as rock climbing, scuba diving, skydiving, and flying. Remember, the agent’s bias is not only to sell you an individual policy, but also to sell you as much coverage as possible with as many riders as you will purchase.

Find out if you are eligible for any group policies through your employer or specialty society.

I generally recommend purchasing a residual disability rider, which provides coverage for a partial disability and for a gradual return to full-time work. Residents and attendings anticipating a large jump in income in the future should strongly consider a future purchase option rider, but attendings in their peak earnings years can simply purchase all their needed coverage now. I also recommend a cost-of-living adjustment rider if you are under age 50. Graded premiums (lower when you are young, then higher when older) rather than level premiums can be useful for those who plan to become financially independent and cancel their policies relatively early in their careers.

If you follow this procedure, you will not have to wonder if your policy is too expensive or if you purchased the wrong one. If you did not follow this procedure, there is no reason to despair. You can always start over at any time—just be sure to also compare your current policy to those now available.

If you’ve had your policy for a few years already, it may very well still be the best one for you and will almost certainly be the cheapest. Remember that the agent’s bias will be for you to replace your policy because that is the only way to get paid.

A Few More Pearls

Women should generally look for a unisex policy because female-specific policies are usually more expensive. Most companies will also offer a significant discount if you pay your premiums once per year instead of monthly. Also keep in mind that you do not need to keep your policy right up until the date of your retirement. Once you are financially independent, feel free to cancel it. Even if you plan to work well into your 60s, remember that these policies usually only pay to age 65 or 67. The closer you are to that age, the less total benefits you will receive in the event of a long-term disability.