Long-term disability insurance pays out if you’re hurt or injured and can’t work, so it can be an important form of financial protection for people with high-paying or specialized jobs, or who have dependents who count on their incomes.
That doesn’t usually include students, though there are some exceptions. If you’re in medical or dental school, or some other program where you anticipate earning a significant amount once you graduate, you might be able to find a policy that protects your future income in case you become disabled before you can work.
Can students get disability insurance?
Not all students qualify for a private disability insurance policy. Insurance companies usually only offer disability insurance to students who are training for a specific, highly-specialized job.
If you’re training for a career in medicine or one in law, for example, you might be able to get disability insurance while you’re a student because of your high future earning potential.
It can be a good idea to get disability insurance while you’re in school so that you can still count on an income if you’re hurt or injured early in your career, or even before you start working. If that happens, you can use your disability insurance to help pay off your student loan debt and other expenses.
How does disability insurance work for students?
Disability insurance works like this: You buy a policy before you actually need it, then if you’re hurt or sick and can’t work, your disability insurance replaces your income, paying you monthly so you can keep up with your regular expenses.
It’s a little different for students. A typical disability insurance policy usually covers about 60% of your income, but since you won’t have much of an income when you’re in school (or any at all), your benefit amount will usually be set at $1,000 to $2,500 a month.
You can adjust your benefits as you go through your program. For example, if you’re studying medicine, you might be able to get higher benefits once you’re in residency and have a small income.
What kind of disability insurance should students get?
Long-term disability insurance offers the best protection. A long-term disability policy can cover you for years (or even until you’re at retirement age), while short-term disability policies only cover you for up to a year — and often less than that.
It’s a good idea for students planning to protect themselves for years to have own-occupation long-term disability insurance. That means that you can receive benefits when you can’t do the specific job you were trained for, even if you can work in another role
For example, if an injury prevents you from being a surgeon, you can still get benefits if you’re able to work in an administrative or teaching role.
You should also look for a disability insurance company that allows you to increase your coverage later on, so you can modify your policy once you graduate without having to do another medical exam.
Disability riders for students
A rider is an add-on or feature that changes your disability insurance coverage. Riders can be free or cost extra, depending on the coverage.
There are a couple of disability insurance riders that you should consider if you buy a policy while you’re in medical or law school.
Future increase rider: Lets you purchase more coverage later on if your income increases (without having to go through another medical exam).
Non-cancelable/guaranteed premiums: Guarantees your coverage and premiums will stay the same as long as you continue to make your payments on time.
Own-occupation disability: You can keep getting payments even after you start working again, as long as you’re not doing the job you originally trained for.
Partial disability benefit: Pays out if you’re not completely unable to work but still lose some income because of an injury or illness.
Student loan rider: Sets aside extra money to continue making your student loan while you’re disabled and can’t work.
Where can you get disability insurance when you’re a student?
You can get disability insurance from any private company that offers coverage to students. We can help you find a disability insurance policy that works for your budget.
If you’re in medical school, your school may also sign you up for disability insurance automatically as a part of your program’s fees. It’s a good idea to talk to your school’s benefits administrator to learn whether you have coverage already or need to purchase more.
If you’re a med student, you can also get disability insurance through membership in an organization like the Association of American Medical Colleges, which offers guaranteed coverage to full-time med school students worth up to $2,000 a month in benefits.
Should I get disability insurance if I’m covered through my school?
It’s still a good idea to get personal disability insurance even if you already get a policy through your school or a professional organization — although depending on your plans, you may want to wait until you’ve started working.
The disability insurance offered by a school or a professional organization is group disability insurance. Group disability insurance doesn’t offer as much protection as a policy you buy for yourself.
Even though group disability insurance is cheaper, you don’t have control over your benefits, and you may also have to pay taxes on any payments.
How much does disability insurance cost for students?
A personal disability insurance usually costs between 1% and 3% of your expected income, but your rates may be more affordable if you get a policy while you’re still a student. The younger you are when you purchase disability insurance, the lower your rates will be.
One way to lower your premiums while you’re a student is by getting a policy with graded premiums. Graded premiums start cheaper and get more expensive over time, as you make more money.
→ Read more about the cost of disability insurance
Best disability insurance companies for students
The best disability insurance company is probably going to be one that has experience covering high earners. That way you can know the insurance company will still be a good fit once you graduate and begin your career.
Some of the best disability insurance companies for students are:
What we like … | BBB | AM Best | |
|---|---|---|---|
Includes a survivor benefit for your beneficiary. | A+ | A | |
Includes a vocational training benefit. | A+ | A- | |
Offers lifetime continuous benefits for total disabilities, even after the policy expires. | A+ | AA+ | |
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 care of a sick loved one. | A+ | A |
How to get disability insurance as a student
You can find the right disability insurance by following these steps:
Frequently asked questions
What isn’t covered by disability insurance?
Your disability insurance won’t cover any self-inflicted intentional injuries. You also won’t receive any coverage for pre-existing conditions, which are medical conditions you had when you bought the policy, like asthma or diabetes.
Do students need long-term or short-term disability insurance?
It’s best to have long-term disability insurance because it has better protection than a short-term policy. That said, having short-term insurance is a good idea if you get it through your school or a medical association you’re a part of — just don’t rely on your short-term insurance by itself.
What waiting period is best for students?
The standard amount of time you have to wait to receive any disability benefits is 90 days. A longer waiting period means cheaper premiums, but be aware that you will have to cover your expenses with your savings during this period.
