Disability Insurance for Psychiatrists: Costs and What to Know

With more than a decade of education and training, psychiatrists are put through a grueling four years of medical school followed by four years of residency. Then, you’re put under the daily stress of helping others manage the complexities of the human brain, which can present with a myriad of mental health conditions.

But what happens when your own health — mental or physical — starts to interfere with your duties as a psychiatrist? What if a long-term injury or illness prevents you from serving your patients to the best of your abilities?

Disability insurance serves as income protection from the unknown. But for psychiatrists with families, it becomes an even more important financial planning tool to protect loved ones. Here’s what to expect with disability insurance for psychiatrists.

Psychiatrist disability insurance premium cost

Disability insurance companies determine your premium using many personal and financial markers. This includes age, gender, occupation, medical history, state of residence and more. 

Most physicians can expect to pay between 2% to 4% of their income for true own-occupation disability coverage.

But premiums for disability insurance for psychiatrists will vary greatly depending on the individual. For example, here’s a sample quote for a female versus a male psychiatry resident or fellow.

Psychiatrist own-occupation disability insurance monthly cost
(Age 34, resident/fellow)

Company	Male	Female
Guardian	$204	$297
MassMutual	$175	$273
Principal	$163	$287
Ameritas	$151	$232
Standard	$168	$267

As shown above, a male psychiatry resident or fellow could buy own-occupation disability coverage with a $5,000 monthly benefit for about $150 to $200 per month. Whereas a female psychiatry resident could pay about $230 to $300 per month for the exact same coverage.

Because women often pay more for disability insurance (up to 35% more), it’s important to work with a knowledgeable independent insurance agent who can compare policy options to find the best unisex pricing.

Keep in mind this quote provides a future increase option, residual disability rider and a catastrophic disability benefit. Your individual premiums will depend on your own needs and preferences.

SLP Insurance can provide a custom quote for true own-occupation disability insurance for psychiatrists. Fill out the form below to get started, or keep reading to learn what you need for adequate disability coverage.

Why do psychiatrists buy disability insurance?

Psychiatrists aren’t as reliant on their hands or limbs for their profession. But you need a sound mind to guide, diagnose and treat patients with a variety of mental health concerns. Your cognitive abilities are of the utmost importance to carrying out your job duties.

As a psychiatrist, you have a deep understanding of the many mental illnesses and disorders that can greatly impact everyday life. Additionally, there are endless physical injuries or disabling conditions that could prevent you from continuing in a profession that you’ve not only dedicated your life to but also likely taken on six-figure student loan debt for medical school.

Long-term disability insurance can help you protect your income and education investment by providing a monthly benefit in the event of a qualifying disability. This payout will continue for a few years or until retirement age, depending on your policy. With true own-occupation disability coverage, you can continue working in another job or field while collecting full benefits.

What should psychiatrist disability insurance include?

The salary of psychiatrists increases rapidly after residency, so they should not overlook some important disability insurance options.

First and foremost, a true own-occupation policy will provide you with the strongest definition of disability. This makes it easier to qualify for a disability claim as you only have to prove that your injury or illness prevents you from carrying out your normal psychiatrist job duties — not from working altogether. Additionally, it allows you to find work outside of the psychiatry field while still collecting full benefits for the duration of your benefit period.

Other important policy decisions include choosing optional riders that might enhance your coverage, such as a future increase option. This rider allows you to increase your benefit amount as your income increases without undergoing additional medical underwriting.

Additional options might include:

• Partial disability rider.
• Cost-of-living adjustment (COLA).
• Catastrophic disability benefit.
• Student loan protection rider.

Different policies will have different policy rider options. And for most, you won’t be able to add them at a later date. So, it’s important to discuss options with a knowledgeable insurance agent.

How often do psychiatrists file disability insurance claims?

Insurance companies classify psychiatrists as a moderate risk occupation. This means you have a higher risk of filing a disability claim than the general public, but not as high as, say, an orthopedic surgeon or cardiologist.

Because of this, you’ll pay higher premiums than low-risk specialties, such as a family medicine physician. But your premiums won’t be as high as medical professionals who perform surgeries and other complex procedures. So, you can think of it as middle-of-the-pack premiums to protect your high income and education investment.

Main types of disability insurance for psychiatrists

Psychiatrists can find disability insurance through several primary places. But your coverage options and premiums will vary, so it’s best to compare each available option.

Employer group policy coverage for psychiatrists

You might already have long-term disability coverage with your employer as part of your overall benefit package. In which case, your employer will foot the bill for your premiums. However, any paid disability benefits will be taxable income — which will cut into your available funds when you need them the most.

Additionally, these group plans often have limited benefits and narrow definitions of disability, making it harder to successfully file a claim.

Professional association options

If you’re part of a professional association or organization, you might have access to discount pricing as part of your membership. For example, you might find discount coverage with the American Psychiatric Association (APA) or the American Medical Association (AMA).

However, member associations usually offer group disability plans that have a number of policy limitations. Additionally, your premiums can increase with age.

Individual psychiatrist disability insurance policy

An individual disability policy gives you the most flexibility for finding own-occupation coverage with policy riders that make sense for you. You can add or remove certain options to tailor coverage and premiums.

It’s best to work with an independent broker who will search the “Big 6” insurance carriers. These are the companies responsible for the majority of true own-occupation policies.

Guaranteed Standard Issue policy

Depending on your residency or fellowship, you might have access to a guaranteed standard issue (GSI) policy. This type of policy provides guaranteed coverage without medical underwriting and unisex pricing — making it a good option for female psychiatrists or those with existing medical conditions.

GSI options are available to residents and fellows via hospitals like John Hopkins, UC Davis and many more. Note that attendings are usually ineligible for a GSI policy, but your hospital might offer other discounts.

How much disability insurance do psychiatrists need?

So, how much of a disability benefit do you actually need? The answer will depend on a variety of factors, such as:

• Household considerations. Do you have a spouse or children who are dependent on your income? Does your spouse also have a high income? Could they find employment to replace your income if needed?
• Financial standing. What are your monthly fixed expenses (e.g., mortgage, car payments, childcare, etc.)? How much do you need to keep your family in the same or similar lifestyle?
• Existing disability coverage. What is your current benefit amount? How strong is the definition of disability? Would you be covered if you can still work outside of the psychiatry field?

Typically, insurance companies allow you to choose a disability benefit that covers up to 60% of your income. However, this percentage might be higher or lower in some cases.

Based on data from the 2022 Medscape Physician Compensation Report, the average psychiatrist salary is about $287,000. Therefore, the average psychiatrist could opt for a maximum benefit of $14,350 per month.

You might not need the full benefit if you have existing coverage or live below your means. However, if you’re the breadwinner of your household, you might consider getting the maximum amount available.

Why you should review your psychiatrist disability insurance policy

Whether you’re shopping around for disability insurance or already have some level of coverage, here are some specifics to consider:

• Look for a true own-occupation disability definition that will provide coverage if you cannot work in the psychiatry field.
• If you have a pre-existing medical condition, you need to work with an independent broker that’ll discuss whether you have access to a GSI policy, as well as individual policy options.
• If you’re a female psychiatrist, you run the risk of overpaying for coverage if you use an agent who only works with one insurance company in exchange for big commissions.

Group disability coverage often isn’t enough due to the weak definition of disability and benefit caps that might not meet your financial needs. In this case, a supplemental individual disability policy can provide you with better coverage overall.

Get a disability insurance quote for psychiatrists

Getting a custom quote for disability insurance is painless with SLP Insurance. Simply fill out the form below, and our team will reach out to compare true own-occupation coverage options. 

If we’re aware of a better discount or policy based on your situation, we’ll refer you to another insurance broker. So, let us do the legwork to find you the best disability coverage and discounts available.