The Best Disability Insurance for Self-Employed People

• Maximum monthly benefit: $30,000
• Maximum benefit period: Up to age 70
• Minimum elimination period: 60 days

MassMutual has high maximum income coverage limits, policies that can cover you up to age 70, and plenty of ways to tailor your policy to your needs. The insurer also offers a business overhead expense policy to cover rent, utilities, and employee salaries if you become disabled.

MassMutual has several advantages for self-employed people. The company’s disability insurance policies cover up to 80% of your income if you become disabled, and its Radius Choice policy offers coverage until you turn 70, which can give you peace of mind for the long term. 

You can also customize your coverage with a wide selection of riders, including an own-occupation rider, which ensures you receive benefits if you can’t work in your specific field; and a professional replacement expense rider, which covers the cost of hiring someone to perform your duties while you’re unable to work.

MassMutual also has two specific policies for small business owners. Its business overhead expense policy reimburses you for expenses such as rent, utilities, and employee salaries while you’re disabled, ensuring your business keeps running. It also has a disability buy-sell policy that provides funds to buy out your share of a company if you become disabled, ideal if you have co-owners.

If you’re married, you and your spouse can save 10% on premiums if you each buy policies from MassMutual.

There are a few downsides. MassMutual only offers short-term disability insurance coverage as a rider, not a standalone policy, and the shortest elimination period before benefits begin is 60 days, which means you’ll need to wait longer before receiving payments while covering expenses out of pocket. Competitors like Principal and State Farm offer shorter 30-day elimination periods.

• Maximum monthly benefit: $18,000
• Maximum benefit period: Up to age 67
• Minimum elimination period: 30 days

Thrivent is a great choice if you want budget-friendly disability insurance and you meet the eligibility requirements. However, Thrivent is a tax-exempt organization similar to a nonprofit, and it only writes policies for Christians or spouses of Christians.

Thrivent stands out as the most affordable option for disability insurance. We collected long-term disability insurance quotes for a 40-year-old dentist making $100,000 for coverage up to age 67, and Thrivent’s monthly premiums were the lowest: $164 for a man and $206 for a woman.

It offers the flexibility of a 30-day elimination period and a standalone short-term disability policy.

In addition, many of Thrivent’s disability policies pay dividends to policyholders, starting on the fifth anniversary of the policy, which policyholders can claim as cash, put toward their policy’s cash value, or use to reduce their premiums.

But there are some limits to consider. Membership in Thrivent is only available to Christians or their families, which may restrict access for many people. The organization’s disability insurance caps maximum income coverage at 70%, lower than that of MassMutual and State Farm, which cover up to 80% of your income. The maximum monthly benefit is $18,000—the lowest of the 10 companies we reviewed—which might not be enough for high earners. Also, you must apply by age 60, an earlier age limit than that of many competitors.

• Maximum monthly benefit: $20,000
• Maximum benefit period: To age 67
• Minimum elimination period: 30 days

If you’re not eligible for Thrivent membership, State Farm is another solid choice for affordable disability coverage, and it has a higher maximum income replacement rate.

State Farm offers competitive rates for disability insurance. In fact, its prices for a male 40-year-old dentist were slightly lower than Thrivent’s (though its prices for women were over $100 higher per month). Another plus is that it covers up to 80% of your income, which is tied for the best in Investopedia’s study. The 30-day elimination period option means you can start receiving benefits sooner. 

But State Farm has some drawbacks. The maximum monthly benefit is $20,000, which is lower than the max benefits for most of the other insurance companies we researched. Other competitors can pay out $30,000 per month or higher. And State Farm has a limited rider selection compared to other insurers.

• Maximum monthly benefit: $35,000
• Maximum benefit period: Up to age 67
• Minimum elimination period: 60 days

If you’re a high-earning self-employed professional looking for the most income protection available, The Standard is a top choice because of its high maximum monthly benefit.

The Standard is a great option for high-earning self-employed people because it offers the highest maximum monthly benefit ($35,000) among the insurers Investopedia reviewed. This makes the insurer a strong choice if you need to replace a large income. The Standard’s disability insurance also has a maximum issue age of 64, tied for the highest in our study.

You get exclusive perks with The Standard. The company’s Platinum Advantage policy includes a family care benefit that replaces some of your lost income if you have to take time away from work to care for a family member with a serious health condition. The Standard also sells a business overhead policy that reimburses business owners if they become disabled, covering expenses like mortgage payments, employee wages, and utilities. For people who co-own their businesses, The Standard’s Business Equity Protector policy provides funding for your partners to buy your share of the business if you become disabled.

Some downsides: The Standard doesn’t offer standalone short-term disability coverage. The shortest elimination period on its long-term policies is 60 days, meaning you’ll need to cover expenses out of pocket for two months before benefits kick in.

• Maximum monthly benefit: $20,000
• Maximum benefit period: Up to age 67
• Minimum elimination period: 30 days

Assurity is a good choice for self-employed workers who need short-term disability coverage. The insurer’s short-term policies have a high average maximum benefit of $5,000.

Assurity’s short-term disability policies offer a relatively high average maximum benefit of $5,000 a month. The company’s prices are also competitive: A 40-year-old dentist earning $100,000 can expect to pay $66 per month if they’re a man and $87 if they’re a woman. By contrast, competitor State Farm’s short-term premiums are lower ($43 and $77) but have a lower average maximum benefit of $2,985.

Assurity policies may provide other helpful features for self-employed people. For the first two years of a claim, you can still get benefits if you can work in a different field, provided that your disability prevents you from working in your usual field. That gives you time to adjust to a potential career change. 

Assurity includes a business owner income enhancement on its Century+ disability policy, which increases your benefit amount by recalculating your net income to include an additional 20% (in essence making up for the portion of your income withheld for taxes). Assurity also sells a business overhead expense policy that covers costs like utilities, employee salaries, and rent if you become disabled.

The tradeoff is that Assurity’s monthly maximum benefit is $20,000, which may not be enough for some high earners. And it doesn’t offer riders that replace contributions to your retirement account or pay off student loans.

• Maximum monthly benefit: $20,000
• Maximum benefit period: Up to age 67
• Minimum elimination period: 30 days

Ameritas offers highly customizable disability insurance coverage with plenty of rider and elimination period options.

Ameritas is a great choice for self-employed people who need more customization options in their disability insurance. The insurer offers a large selection of riders, including a future increase option that lets you increase your coverage without a medical exam, and a cost-of-living adjustment rider that boosts your benefit payments to offset inflation. The future increase option may be especially important for self-employed people whose income and expenses may fluctuate over time.

You can also choose from five elimination periods, including a 30-day option, which helps you get benefits faster. Additionally, Ameritas has a one-year guaranteed renewable policy if you need short-term coverage.

Ameritas has some limitations. The company’s maximum income coverage is 66%, tied for the worst rate in Investopedia’s review. By contrast, MassMutual and State Farm plans can cover up to 80% of your income. And the insurer’s policies have a maximum monthly benefit that may not be enough for the highest earners.