Lawyers need disability insurance just as much as, if not more, than other professions.
When you think of someone who needs a long-term disability insurance policy, you may think of someone who does a lot of physical labor and needs help making ends meet. You probably don’t think of a lawyer.
But lawyers need disability insurance just as much as — if not more than — other professions due to their investment, their earning potential and their risk of disability.
Becoming a lawyer can earn you a lot of money, but it’s also a hefty upfront investment. You need a college degree, and then a law degree and then you need to work to pay that schooling off. According to U.S. News and World Report, the average cost of a public in-state law school in 2016-2017 was more than $26,000 a year. The top 10 law schools had an average annual tuition of more than $60,000. That’s on top of standard college costs.
Lawyers rack up debt before they take their first case. Considering that the same U.S. News and World Report study shows the median private sector starting salaries for law graduates is well under $100,000, it’ll take time to pay that off, but you can’t do it if you’re not working.
Luckily, law students and new lawyers can buy more disability coverage than is typically allowed by insurance companies due to their future earning potential. Since long-term disability insurance is cheaper the earlier you buy it, you can get a great deal on a policy that will protect you for your entire career. (Lawyers usually get the top rates anyway. There’s no excuse for not buying.)
Even though being a lawyer is a white collar profession, you’re still at risk of becoming disabled. According to the Council for Disability Awareness, 90% of disabilities are due to illness, not injury. Even if law books are the heaviest thing you’re lifting, attorneys can still benefit from having a disability insurance policy.
Attorneys should work with a licensed agent to make sure they’re working with a company and policy that’s best for them. As far as which are the best disability insurance companies for attorneys by cost, here’s a list of sample rates.
|Company||30 years old||40 years old||50 years old|
|Ameritas||$110.76/mo | $1,281.40/yr||$176.76/mo | $2,048.80/yr||$271.65/mo | $3,152.20/yr|
|Assurity*||$125.90/mo | $1,447.20/yr||$211.45/mo | $2,430.35/yr||$281.55/mo | $3,236.69/yr|
|Guardian||$104.56/mo | $1,254.55/yr||$159.50/mo | $1,914.00/yr||$241.22/mo | $2,894.62/yr|
|Principal||$123.09/mo | $1,405.80/yr||$185.53/mo | $2,119.05/yr||$274.26/mo | $3,132.45/yr|
|The Standard||$127.51/mo | $1,457.30/yr||$184.84/mo | $2,112.47/yr||$276.88/mo | $3,164.31/yr|
|MassMutual||$105.19/mo | $1,237.20/yr||$162.26/mo | $1,896.88/yr||$260.81/mo | $3,036.20/yr|
|Mutual of Omaha**||$126.80/mo | $1,449.00/yr||$190.48/mo | $2,176.77/yr||$291.59/mo | $3,332.41/yr|
*Non-cancelable policies not available
**To age 67; non-cancelable policies not available
These sample rates are based on $5,000 monthly benefits for non-smoker males in New York. The maximum benefit amount would be determined by your gross income and any other group or individual plans you have in place. They are own occupation with 90-day elimination periods, age 65 benefit periods and partial residual benefit, future purchase, non-cancelable and automatic increase benefit features (unless otherwise noted).
So what should attorneys be aware of when they’re shopping for a disability insurance policy?
First, know your plan’s definition of own-occupation. You may still get benefits if you’re unable to work your own job — being an attorney — even if you’re still able to work in another capacity. Knowing what your policy considers your occupation can mean a huge difference in the benefits you receive.
While many firms don't have group plans, larger ones might. It is important to review since some plans have maximum monthly benefits that cap out at $5,000 or $10,000 and may not be sufficient to replace your income. If your firm pays the premiums on your policy, the benefits are subject to taxation. A supplemental policy can help fill the gaps in coverage and cover what your employer policy loses in taxes.
If you buy your policy while you’re young, it’s more affordable, and a future purchase option lets you add more coverage later on without additional underwriting. This gives you the flexibility to switch firms or branch out on your own without worrying about your disability coverage being tied to your current employer.
To help pay for those student loan bills you probably accrued, a student loan rider can help. It adds a little to the benefit to help pay for student loans, usually around $2,000 a month, which goes directly to the loan provider. You can learn more about how disability insurance can protect against student loan debt here.
If you work based on billable hours, a residual or partial disability plan is crucial. This means that if you can work but have reduced hours or income, you can still receive limited benefits.
Lawyers put too much time and money into their profession to leave it up to chance. A long-term disability insurance policy is the perfect way to ensure you’ll meet your potential and have a successful career no matter what happens along the way.
Not a lawyer? Find the best disability insurance companies for your career.
Colin Lalley is the Associate Director of SEO Content at Policygenius in New York City. His writing on insurance and personal finance has appeared on Betterment, Inc, Credit Sesame, and the Council for Disability Awareness.