Long-term disability insurance is essential for attorneys. Think of disability insurance like income protection insurance — it will pay out if you’re suddenly hurt or become ill and can’t practice law anymore, and like most types of insurance, you want to get a policy before you need it.
The right long-term disability policy can cover up to 80% of your income while you’re not working, and you can use the payments on anything from childcare to paying off law school loans.
Why lawyers need disability insurance
It’s especially important to have disability insurance if you’re a lawyer, since you ’ve invested years of expensive training in your career. A long-term disability insurance policy is a way of protecting that investment.
Long-term disability coverage can pay out for years or even decades after your disability. You can use your disability insurance payments just like your regular income, which means you can pay for:
Law school debt
Mortgage payments
Childcare expenses
Groceries and other necessities
Without disability insurance, you would have to rely on your savings to replace your lost income.
What is the best disability insurance for attorneys?
The best disability insurance for attorneys is a long-term, true own-occupation disability insurance policy. An own occupation policy allows you to receive disability benefits if you work another job, as long as you can’t work as a lawyer.
Let’s say that you can’t practice law after a stroke, even though you can still hold a job outside of the legal profession. Your own-occupation policy would replace the income you made as a lawyer and allow you to earn money from the other job.
Having long-term disability insurance instead of (or in addition to) short-term disability insurance is also important for lawyers. Short-term policies only pay out for a year at the most, while long-term disability insurance can cover you until you can retire.
What about the insurance you get from work?
If your practice or firm offers an employer-sponsored disability insurance policy, you should definitely opt in, but we still recommend getting your own personal long-term disability policy.
That’s because group insurance, which is usually fully or partially paid for by your employer, has some drawbacks compared to a personal policy:
It’s usually short-term coverage, which means it will only cover you for up to a year at the most
It’s tied to your current employer, unlike a personal policy, which you keep for as long as you want
If your premiums are deducted from payroll, you’ve paid for the policy with pre-tax income, so you’ll have to pay taxes on your benefits
Disability insurance riders for attorneys
Disability insurance riders are additions or changes to your disability insurance coverage. Here are some disability insurance riders that can help you get the most out of a policy.
Cost of living adjustment (COLA): Automatically increases your monthly benefit every year to keep up with inflation.
Future increase rider: Lets you purchase more coverage later on when your income increases without having to go through another medical exam — useful if you’re young and expect your income significantly to go up over time.
Non-cancelable/guaranteed premiums: Guarantees coverage at the same rates as long as you continue to make payments on time.
Partial disability benefit: Pays out if you’re not fully disabled, but still lose some income because of an injury or illness.
Presumptive disability benefit: Pays benefits without a waiting period if you lose the use of your hands, feet, or speech.
Retirement protection: Replaces the retirement contributions you would have made while you worked.
Student loan rider: Continues making your law school payments while you’re disabled.
Cost of disability insurance for lawyers
Disability insurance generally costs about 1% to 3% of your annual income. The median pay for lawyers is $127,990, which means you can expect to pay between $106 to $320 a year for disability insurance. [1]
The more money you make as an attorney, the more disability insurance coverage you need, which means higher rates (age, health and hobbies will also affect what you pay).
Are graded premiums a good idea for lawyers?
If you’re a current law student or an early-career lawyer who’s still paying off law school debt, you may want to consider a disability insurance policy with graded premiums instead of level premiums.
Graded premiums mean you pay lower rates earlier on in the policy, and your disability insurance gets more expensive as you age. When your rates get higher later in life, you’ll be able to afford the cost increase.
Best disability insurance companies for lawyers
The best disability insurance companies for lawyers are companies that have experience covering high earners. These companies are most likely to have useful riders for lawyers (like riders for cost of living adjustments, future increase, and retirement protection).
Some of the best disability insurance companies for lawyers are:
BBB rating | A.M. Best rating | What we like about it … | |
|---|---|---|---|
A+ | A | Includes a survivor benefit for your beneficiary. | |
A+ | AA+ | Offers lifetime continuous benefits for total disabilities, even after the policy expires. | |
A | A++ | Offers a future insurability rider that's good until your 60th birthday. | |
A+ | A+ | Offers a lump-sum payment of $62,400 in addition to regular benefits if you're presumptively disabled. | |
A+ | A | Includes a family care benefit if you have to take time off to care for a sick loved one. |
How to get disability insurance for lawyers
Attorneys can find disability insurance that meets their needs by following these seven steps:
Frequently asked questions
What are the best disability insurance companies for people in law school?
If you’re still in law school, you can still get disability insurance from companies that usually work with people earning high incomes. If you can afford to lock in coverage at an early age, you’ll be able to get lower disability insurance rates than if you wait until you’re older.
Should lawyers get more disability insurance?
Lawyers should get more disability insurance than someone who doesn’t earn as much. Since attorneys go through years of specialized schooling before they see high salaries, it’s important to be sure their income would be protected if they could no longer practice law.
Do attorneys need long-term or short-term disability insurance?
While long-term disability insurance is better for protecting lawyers’ incomes in the long run, having short-term disability insurance is certainly better than not having any coverage at all. If you already have short-term disability insurance through your firm or employer, consider adding supplemental coverage and a long-term policy for more protection.
Do lawyers need a future increase option?
Yes, it can be worth getting a future increase option when you buy disability insurance. This rider allows you to add more coverage to your policy later on, so it’s a good idea if you think you’ll make more money later in your career.
