Best Long-Term Disability Insurance Plans and Waiting Periods in 2025

What you need to know before you buy

Long‑term disability (LTD) insurance isn’t something most people think about until they need it. But for many workers, a serious illness, injury, or chronic condition could cut off your income long before you retire. That’s where long‑term disability insurance comes in. It replaces a portion of your income if you can’t work for an extended period. Choosing the right plan and understanding waiting periods are key to having financial security when you can’t work.

In this guide, we’ll break down how long‑term disability insurance works in 2025, what waiting periods mean, what top plans look like, and how to choose the best option for your situation.

What Is Long‑Term Disability Insurance?

Long‑term disability insurance is a policy that pays part of your income if a serious illness or injury prevents you from working for an extended period. Unlike short‑term disability—which may cover a few weeks to a year—LTD benefits can last several years, up to retirement age for some plans.

Most policies replace about 60% of your pre‑disability income. They’re designed to help cover expenses like rent or mortgage, utilities, food, and other everyday costs when you cannot work because of a health condition.

Understanding Waiting Periods (Elimination Periods)

A critical part of any disability policy is the waiting period, also called the elimination period. That’s the time between when your disability begins and when your benefit payments start.

Why Waiting Periods Matter

The waiting period affects:

When benefits start
Cost of your premiums
Your financial planning during the disability

Longer waiting periods usually mean cheaper monthly premiums, but you’ll need savings or other coverage to support yourself until benefits kick in. Shorter waiting periods cost more but reduce your financial risk if disability strikes.

Typical Waiting Periods in 2025

In 2025, long‑term disability policies commonly offer elimination periods such as:

30 days
60 days
90 days (most common)
180 days
365 days

Some plans allow customization so you can choose based on your financial cushion.

Example: If you select a 90‑day waiting period, benefits won’t begin until three months after your disability starts.

Knowing this helps you plan how much short‑term savings you need, or whether you should also carry short‑term disability insurance to cover the gap.

Types of Long‑Term Disability Plans

Not all LTD plans are created equal. Here are common ways you might get coverage:

1. Group LTD Insurance (Through Employer)

Many employers offer group LTD coverage as part of benefits packages. These plans are often cheaper because:

Employers may pay part or all of the premium
No medical underwriting is required in many cases

However, group plans can be limited. They often:

Pay lower benefit amounts
Have less flexible waiting periods
Cover less of your income compared to individual policies

Group LTD is great as a base layer, but you might need supplemental individual coverage for full protection.

2. Individual Long‑Term Disability Insurance

Individual plans are purchased directly by you, not tied to your job. These typically offer:

Higher benefit levels (e.g., up to 60% of income)
More options for waiting periods
Better occupation‑specific definitions (especially if you have a specialized job)

Carriers like Lincoln Financial, Prudential, Aflac, Assurity, Mutual of Omaha, Northwestern Mutual, and The Hartford are often listed among well‑rated providers for individual LTD coverage.

3. Custom Plans for Professionals

High‑income professionals and specialists (like doctors or lawyers) often benefit from policies with:

Own‑occupation definitions (meaning you’re covered if you can’t perform the duties of your specific job)
Cost‑of‑living adjustments
Partial disability benefits

Top carriers recommended for professional coverage in 2025 include Ameritas, Guardian, MassMutual, Principal, and The Standard. These often offer robust benefit structures tailored to complex careers.

What Makes a Long‑Term Disability Policy “Good”?

A strong long‑term disability plan isn’t just about price. Here are key features to consider:

1. Waiting Period Options

Choose a waiting period that matches your savings plan. If you don’t have enough to cover expenses for 6 months, a 90‑day waiting period could be too long.

2. Benefit Period

This is how long the policy will pay benefits. Common structures include:

5 years
10 years
Up to age 65/67/70

Longer benefit periods cost more upfront but give greater peace of mind.

3. Definition of Disability

Policies usually define disability in one of two ways:

Own occupation: Benefits if you can’t work in your own job
Any occupation: Benefits only if you can’t work in any job

For most professionals, own occupation coverage is more valuable.

4. Riders and Add‑Ons

Many policies let you add riders that enhance coverage, such as:

Cost‑of‑living adjustment (COLA)
Future increase options
Partial disability benefit

These add flexibility but may add to cost.

5. Carrier Financial Strength

Choose a carrier with strong financial ratings and a solid reputation for paying claims. Ratings from agencies like A.M. Best and Moody’s help you evaluate stability.

Comparing Waiting Periods: Pros and Cons

Waiting Period	Pros	Cons
30 days	Fast benefit start	High premiums
60 days	Good balance of cost and speed	Still higher cost
90 days	Most common	You need savings for first 3 months
180+ days	Lower premium	Big savings gap if disabled

A shorter waiting period reduces your financial risk but costs more. The right choice depends on your emergency fund and other coverage you carry.

How Waiting Periods Affect Your Premiums

Insurance companies price policies based on risk. A longer waiting period lowers the insurer’s exposure, so they charge less. This means a 180‑day waiting period can significantly reduce monthly premiums compared to a 30‑day waiting period.

However, if you end up disabled and have no other savings or short‑term benefits to rely on, a long waiting period could leave you financially strained.

Real‑World Examples

Let’s look at how waiting periods can play out:

Scenario 1: Short Waiting Period

Sarah chooses a 30‑day waiting period because she has limited savings. Her monthly premiums are higher, but her benefits begin sooner. When she breaks her back and can’t work for months, benefits start within one month.

Scenario 2: Long Waiting Period

John selects a 180‑day waiting period to save on premiums. He relies on his savings during the waiting period. He gets injured and can’t work for nine months. Benefits begin after six months, reducing his out‑of‑pocket burden.

In both cases, planning for waiting periods ahead of time makes the difference.

Tips for Choosing the Best Long‑Term Disability Plan

Start early. Buying coverage when you’re younger and healthier often lowers premiums.

Know your occupation class. Some jobs have higher risk classifications, which affects pricing.

Think about income replacement. Aim for a policy that covers at least 60% of your income.

Use an independent agent. They can compare carriers and waiting period options across multiple insurers.

Review policy definitions carefully. The way disability is defined can impact whether your claim is paid.

Conclusion

Choosing the right long‑term disability insurance plan in 2025 means looking beyond premiums. Waiting periods are a fundamental part of planning—they determine when benefits start and how much you’ll pay.

Your goal should be to find coverage that fits your financial picture, offers a sensible waiting period, and comes from a reliable carrier. Whether through an employer plan or an individual policy tailored to your career, long‑term disability insurance is one of the most important pieces of financial protection you can buy.

Understanding how waiting periods affect both cost and benefit timing will help you build a stronger safety net, so you can protect your income and your future.

Frequently Asked Questions (FAQ) about Long-Term Disability Insurance Plans and Waiting Periods

1. What is long-term disability insurance?

Long-term disability (LTD) insurance provides income replacement if you become unable to work due to a serious illness or injury for an extended period. This insurance typically covers a portion of your income, allowing you to maintain financial stability while you’re unable to work.

2. What is a waiting period in long-term disability insurance?

The waiting period, also called the elimination period, is the time you must wait after becoming disabled before your benefits begin. Waiting periods typically range from 30 days to 365 days. Longer waiting periods often mean lower premiums, but you’ll need to cover your expenses out-of-pocket until the benefits start.

3. How long is the typical waiting period for long-term disability insurance?

Most long-term disability insurance policies have waiting periods ranging from 60 to 90 days. However, some plans offer waiting periods as short as 30 days or as long as 180 to 365 days. The length of the waiting period typically affects the cost of premiums.

4. How does the waiting period affect the cost of long-term disability insurance?

The longer the waiting period, the lower your premium will typically be. Insurance companies charge higher premiums for shorter waiting periods because they are more likely to pay out benefits sooner. Conversely, longer waiting periods mean less risk for the insurer, resulting in lower premiums for the policyholder.

5. Can I customize the waiting period on my long-term disability policy?

Yes, many long-term disability insurance providers allow you to customize the waiting period based on your needs. If you have sufficient savings to cover a longer waiting period, you can choose a longer elimination period to reduce your premiums. If you don’t have savings to cover a gap, opting for a shorter waiting period might be a better choice.

6. What is the difference between short-term and long-term disability insurance?

Short-term disability insurance covers you for a brief period (usually up to six months) if you are temporarily unable to work due to illness or injury. Long-term disability insurance kicks in after the short-term policy expires and can cover you for years or until retirement age, depending on the terms of the policy.

7. What are the most common types of long-term disability insurance plans?

Group LTD Insurance (Employer-sponsored): Often cheaper, but may offer less coverage and flexibility.
Individual LTD Insurance: Purchased directly from an insurance company, these plans typically offer more customizable options.
Professional LTD Plans: Tailored to professionals with higher income or specialized occupations, offering benefits based on your specific job and income level.

8. How much of my income does long-term disability insurance cover?

Most LTD policies replace around 60% to 70% of your pre-disability income. Some policies also offer cost-of-living adjustments or additional riders that increase the benefit amount based on inflation or specific needs.

9. Can I have both short-term and long-term disability insurance?

Yes, it is possible to have both short-term and long-term disability insurance. Short-term disability insurance covers you for a few months, and long-term disability insurance kicks in after that period ends. Having both provides comprehensive coverage during longer periods of incapacity.

10. What factors should I consider when choosing the waiting period for my policy?

Your financial cushion: If you have significant savings or other sources of income, you may be able to afford a longer waiting period and lower premiums.
Job stability and income needs: Consider how long you can financially survive without your primary income.
Health risks and job demands: If your occupation involves physical labor or you are at high risk for injury, a shorter waiting period may be more beneficial.

11. How do I know if I’m choosing the right long-term disability insurance plan?

The right plan depends on your individual needs. Key considerations include:

Waiting period and benefit period: Ensure the waiting period fits your savings and income situation.
Coverage amount: Aim for a plan that covers at least 60% of your income.
Policy definitions: Choose policies that define disability in terms that are favorable to your career (e.g., own occupation vs. any occupation).

12. Do all long-term disability insurance policies cover mental health conditions?

Mental health conditions like depression or anxiety can be covered under long-term disability insurance policies, but coverage may vary. Some policies have specific exclusions or restrictions for mental health conditions, so it’s essential to read the fine print and clarify with your insurer whether mental health coverage is included.

13. Is long-term disability insurance tax-free?

Long-term disability benefits may be taxable or tax-free depending on how the policy is paid for. If your employer pays for the premiums and doesn’t tax the benefits, your LTD benefits will be taxable. If you pay for the policy with after-tax dollars, your benefits will generally be tax-free.

14. Can I add riders to my long-term disability insurance policy?

Yes, many long-term disability policies allow you to add riders for additional coverage. Common riders include:

Cost-of-living adjustments (COLA) rider: Increases your benefit to keep up with inflation.
Partial disability rider: Allows you to receive benefits if you can work part-time but still can’t perform all your job duties.
Future increase option: Allows you to increase coverage without medical underwriting in the future.

15. What is the process to file a claim for long-term disability insurance?

To file a claim for long-term disability, you typically need to:

Notify your insurance company within the time frame set by your policy (often 30 days after your disability begins).
Provide medical documentation from your doctor outlining the condition preventing you from working.
Complete required forms provided by the insurer, which may include detailed information about your job duties and how your disability affects your ability to work.
Follow up regularly to ensure the insurer has all the information needed to process your claim.

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