Average Cost of Physician Disability Insurance: What Impacts Your Premiums?

The average cost of physician disability insurance is more expensive than other types of financial security, such as term life insurance. But long-term disability coverage costs more because you’re more likely to use it throughout your career.

The Social Security Administration estimates that about 25% of today’s 20-year-olds will suffer a long-term disability before retirement. However, that statistic is based on a standard definition of disability — not one that caters to your medical or dental specialty. So, you could be more likely to file a disability claim based on the job duties of your specific occupation.

But how much does it cost to get own-occupation disability insurance coverage? Let’s find out.

How Much Does Disability Insurance Cost?

Disability insurance is a complex financial product. So we can’t give you an exact dollar amount that fits everyone. But as a general rule of thumb, you can expect to pay anywhere from 2% to 4% of your income for own-occupation coverage.

The cost of disability insurance will depend on various policy decisions and individual risk factors unique to you.

Policy decisions that change the cost of disability insurance

The specifics of your disability insurance policy will partially dictate your premiums.

For example, your costs will increase or decrease depending on how much disability insurance you need. Most resident physicians buy a policy with a $5,000 monthly benefit amount. But an  attending physician might buy $10,000 to $15,000 per month or more. The higher your payout, the more you’ll pay for coverage.

Other policy decisions will also impact your disability premiums, including:

• Benefit period. You can choose a policy that pays out for two or five years, or go with a policy that provides disability income through retirement age. The longer the benefit period, the higher the premium.
• Disability riders and benefits. Policy riders can make your disability coverage custom to your financial needs and risk tolerance. Some riders are built in to the policy, while others will increase your cost of disability insurance.  For example, a future option rider benefits residents, fellows and young physicians who aren’t at their full earning potential yet. But the added cost might not make sense for physicians later in their careers.
• Waiting period. The elimination period is the length of time from when you experience a disabling event to when you start collecting disability insurance benefits. A standard waiting period is 90 days, but you can choose another period of time.

Your disability insurance costs also depend on who you work with. For example, if you’re working with an insurance agent that earns large commissions by steering policyholders to one insurance company, you’ll likely pay for an inflated policy.

But an independent insurance broker who searches the “Big 5” can access policy discounts to make own-occupation coverage more affordable.

Related: Graded vs. Level Premium Disability Insurance: A Breakdown of Costs

Risk factors that disability insurance companies consider

Your policy preferences can change the cost of disability insurance. But so can certain characteristics of the policyholder.

When buying a long-term disability insurance policy with own-occupation coverage, insurance carriers will consider your risk of filing a claim based on your medical or dental specialty. They’ll also look at your age and gender to help determine your policy premiums.

Other premium considerations include your medical history, where you live, whether you smoke and if you engage in risky activities, like skydiving or scuba diving. 

If you are a physician interested in getting a quick quote for disability insurance, fill out the form below. If you're still not sure if you understand enough about the ins and outs of physician disability insurance to commit to submitting information for a quick quote, keep reading for more thorough explanations.

The Average Cost of Physician Disability Insurance: Example Scenarios

Occupation, age and gender play significant roles in determining your premium rates. So, here are a few scenarios to better understand how they can affect the average cost of disability insurance for an individual policy.

Your specialty impacts the average cost of physician disability insurance

Disability insurance companies use historical claims data to rate medical and dental specialties into risk classifications. Occupations that perform non-invasive procedures receive more favorable rates than invasive specialties. This is primarily because physicians who rely on their hands for surgeries are more vulnerable to a disabling injury or medical condition.

Related: How to Buy Disability Insurance for Pulmonologists

Case study: Primary care doctor vs. trauma surgeon

Let’s see how the average cost of physician disability insurance can differ for primary care doctors versus trauma surgeons based on occupation classes.

Alexander and Juan are medical residents/fellows in their mid-30s looking for a true own-occupation policy. Both want a $5,000 base monthly benefit with a $15,000 future increase option.

Based on their medical specialty, they can budget the following average costs of physician disability insurance:

• Primary care resident, Alexander, might pay around $130 to $180 per month.
• Trauma surgeon fellow, Juan, might pay about $175 to $220 per month.

This shows how a surgeon might pay more than a doctor who practices non-invasive medicine.

Note that example costs include residual/recovery benefits, mental and nervous disorder coverage and a cost-of-living adjustment (COLA) rider. They also include 10% to 30% premium discounts, available through SLP Insurance.

Case study: Orthodontist vs. cosmetic dentist

Now, let’s see how the average cost of physician disability insurance changes depending on your dental specialty.

Denise and Scarlett are finishing their respective orthodontic and dental anesthesiology residency programs. We’ll stick to the same disability plan as before, with a $5,000 monthly benefit and a $15,000 future purchase rider. We’ll also opt for the same policy riders and SLP Insurance discounts as the previous example.

For a true own-occupation definition of disability, they can expect premiums of around:

• $215 to $385 per month for the orthodontic resident, Denise.
• $290 to $350 per month for the dental anesthesiology resident, Scarlett.

Keep in mind that these example quotes are specific to their age, gender, dental specialty and policy options outlined above.

Related: How to Buy Disability Insurance as an Endocrinologist

The cost of disability insurance increases with age

You’ll pay more for disability coverage as you get older — which is why many physicians choose to buy disability insurance during residency.

Case study: Premiums at different ages

Joseph is a surgical resident in good health and wants to purchase a $5,000 benefit. His policy preferences include a benefit period that pays out to age 65 with a 90-day elimination period. He plans to have residual disability benefits, a COLA rider and catastrophic disability benefits.

For specialty-specific coverage, Joseph can expect to pay the following disability insurance rates depending on what age he decides to purchase the policy:

• Age 30: $178 per month
• Age 33: $196 per month
• Age 35: $211 per month
• Age 40: $256 per month

This is a great example of why it’s best to lock in disability insurance premiums when you’re at the youngest and healthiest stage of your career.

Related: When to Purchase Physician Disability Insurance

Gender changes the cost of disability coverage

Unfortunately, women often pay higher premiums than men for the same disability coverage. The good news is that women can access unisex discounts to help bring down the cost of disability insurance. But you’ll need to work with a knowledgeable insurance broker.

Case study: Female vs. male OB/GYN

Katherine and Jason are in the middle of their gynecology and obstetrics residency program. With identical disability insurance for their OB/GYN specialty, Katherine will pay more for coverage than Jason.

Jason could pay monthly premiums anywhere from $160 to $250. However, Katherine could be looking at monthly costs ranging from $290 to $360, simply based on gender.

Note that these gender-based average costs of disability insurance quotes have a $5,000 benefit with a $15,000 future purchase option. They also include SLP Insurance discounts, residual and recovery benefits, mental and nervous disorder coverage, and an inflation rider.

Related: Principal Disability Insurance Review: Dependable Coverage for Physicians

Choosing the Right Disability Insurance for Physicians

The cost of disability insurance is a huge deciding factor, especially if you’re juggling student loan payments. Individual disability insurance policies are designed for flexibility, so you can choose a coverage level that you’re comfortable with.

Depending on your financial situation, you might not need the maximum coverage amount, which can reduce your monthly premiums. Otherwise, you can consider different policy riders and change details, such as your benefit period, to lower your costs.

SLP Insurance is available to hunt down the top discounts and find you the most affordable, comprehensive coverage. For a custom own-occupation quote, fill out the form below.