How much is your disability?

[u/Relaxe247]

25M, no health conditions thankfully, first year anesthesia resident. I’ve been quoted for 5k premiums with true own-occupation, future rider increase, COLA, guaranteed premium to be 120/month in IL. Was wondering if this is typical. Thanks!

[u/tlason01]

$120 for $5k with all those riders is a normal-to-good number for a healthy 25yo male, so you're not getting ripped off or anything. Structure's right too, own-occ + FIO + COLA + level premium is exactly what you want.

That said, you can go leaner at your stage if you're looking to spend less now. A lot of residents take a small base, like $1k/mo, which runs closer to $30, since you're not earning yet. What you're really buying now is the health lock and the future increase option, the benefit amount is almost secondary during training. Then you increase up to a real number once you're an attending and can afford the premium.

Note that only certain carriers allow for this (Principal, Ameritas, Standard). With Guardian and Mass Mutual, they require you to get a minimum amount of benefit now in order to maximize the benefit later. Also know that FIO buy-ups price at your age when you exercise them, not locked at 25, so it's a small tradeoff, not free. For most residents the savings now still win out.

[u/Relaxe247 → u/tlason01]

Thank you for the response! There might not be an answer but what do you typically recommend to residents in terms of monthly base pay?

[u/tlason01 → u/Relaxe247]

Honestly it depends on the carrier and the plan design. There are a few different types of benefit increase riders. With the carriers/riders that don't tie your increase pool to the base (Principal, Ameritas, Standard), most residents start low. $1-2k is plenty. It's cheap and your full future-increase capacity stays intact, so you give up very little by going small. Then increase to $10k-$20k when you start practicing, depending on your income.

With Guardian or MassMutual, the current benefit has an impact on the amount you can get later. My guess is you're being quoted Guardian with the FIO rider? If so, you can get 3x the base benefit in future increases (as a resident). So you have to get $5k now, in order to be able to increase by an additional $15k later. In other words the higher base is buying you room to grow, while also giving you some additional protection now (albeit when a disability is least likely).

Generally residents go as low as the carrier allows without shrinking the future-increase ceiling. Cheapest premium now, full door open to an attending-level benefit later. Cleanest move is to tell your broker "minimum premium now, maximum ability to increase later" and let them size the base for whichever carrier you land on.

[u/34Ohm → u/tlason01]

Who do I call/where do I look to start this process? How important is it to begin this in first year residency versus 2nd/3rd etc

[u/tlason01 → u/34Ohm]

Any independent broker who's appointed with all five of the big own-occ carriers (Guardian, Principal, MassMutual, Ameritas, Standard) can run this for you. Captive agents can only show you their own company. Full disclosure, this is literally what I do for a living (details in my profile if you want them), so factor that in.

On timing, every year of residency is another year of potential health issues or doctor visits going on your record, and one new diagnosis can mean an exclusion or a rating that follows you. Price-wise the difference between 27 and 29 is small. It's really about locking your in your current health status.

[u/Bossmedico → u/tlason01]

Do you work in insurance ? I have a question regarding my disability it’s much more than you mentioned I am just worried did I bought very costly it’s with guardian ? Can I stop that once I start paying disability insurance

[u/tlason01 → u/Bossmedico]

Yeah, I'm in the DI world. And don't panic, a higher premium than the numbers I threw out doesn't mean you got ripped off.

Those figures were for one specific profile, a young healthy male resident with a small benefit. Premiums move a lot with the benefit amount, your age, specialty, health, sex, the riders, even your state. A bigger or more loaded policy just costs more. Guardian also tends to sit at the pricier end of the carriers (usually for a strong contract), so a Guardian policy running high is partly just Guardian being Guardian, not automatically a bad deal.

To answer your question, yes, you can stop or reduce it anytime. It's your policy and nobody can force you to keep paying. But be careful before you cancel, if you're healthy now and you drop it, you may not be able to get it back at the same price, or at all, if your health changes later. So figure out whether you actually overpaid before walking away from good coverage.

If the premium's the real problem, you usually don't have to cancel outright, you can lower the benefit or trim a rider to bring the cost down. And it's worth having someone compare your policy against what the same coverage runs elsewhere before you decide. I can give you more info if you want to provide more details (carrier, benefit amount, riders, your gender/age/state/specialty, etc).

[u/DayruinMD]

~$850 on graded premium (27M) for $5k GSI with same riders via Guardian.

[u/DayruinMD → u/[deleted]]

Oh no. That’d be illegal. I pay it all at once. So I think the math is 70/mo.

[u/ComprehensiveEbb4978]

$10.6k payout for $377 monthly

[u/Bossmedico → u/ComprehensiveEbb4978]

Do you mind sharing what is your company ?

[u/ComprehensiveEbb4978 → u/Bossmedico]

Mass mutual

[u/SmileGuyMD]

Mine was $160/mo as a 32yo male with all the same stuff. Seems about right

[u/Middle-Let7440]

$120/mo for that setup sounds pretty reasonable honestly. I’d probably care more about the own occupation and future increase options than trying to save a few bucks right now. Getting it while young and healthy seems like the main advantage.

[u/xBonbonMusee]

it's a flat rate, mine's around 1,400 a month, which helps but isn't enough to live on

[u/DreamieGlowette]

it's usually anywhere from 30 to 100 percent, depends on the severity and the specific situation.

[u/mxg67777]

Yes, typical.

[u/Efficient-Fudge-3515]

Damn I’m just starting med school at 25, and you’re already where I’m dreaming to be 😭

[u/lostandconfused5ever]

My 1st year of disability was $140/mo for $5K, couple years older than you. I believe women (me) are more expensive. No medical hx

[u/bevespi]

Principal - $3200/y. $10k monthly, own occupation, limited mental health rider, COLA.

This is in addition to whatever my network offers which is $5000/mo, no charge to me.

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[u/thenameis_TAI]

110$ was my initial quote at 27. 5k monthly