Disability insurance question

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Post Reply
Posts: 65
Joined: Sat May 21, 2016 2:30 am

Disability insurance question

Post by bogleboyz » Thu Mar 23, 2017 11:57 pm

Hi Everyone
I am facing a dilemna whether to change my disability insurance

I currently have a metlife disability policy for $5,000 monthly benefit (omni advantage) with elimination period of 180 days. I am paying about $2,080 per year
It has the following riders
lifetime benefit for total disability (no charge)
monthly benefit for residual disability with 24 m recovery benefit ($312)
presumptive disability (no charge)
your occupation benefit ($319)
Guaranteed insurability ($96.3)
max total increase $5000
unit of increase $1000

I have recently been offered 2 other policies which are also "own occupation" for the same benefit of $5,000 per month for lower premiums.

The first offer is from Ameritas for a premium of $1522 per year. If i add COLA to this policy the premium is $1757 per year

Ameritas polcy has the following riders
Nondisabling Injury Benefit
COBRA Premium Benefit
Survivor Benefit
Good Health Benefit
Presumptive Total Disability
Surgical Transplant Benefit
Cosmetic Surgery Benefit
Waiver of Premium
Optional Riders Selected
Enhanced Residual Disability Rider

Second offer is from MassMutual for a premium of 1460 per year. This includes the own occupation rider and extended partial disability rider.
If i add catastrophic disability benefit rider for monthly benefit of $12000, the premium is $1683 per year

I would really appreciate if you can give me some advice regarding which policy to choose.

As you can see the premium for my current metlife policy is higher as compared to the policies offered by Ameritas and MassMutual. But i understand there can be important differences between these policies.
Metlife policy seems to have the lifetime benefit rider for total disability which provides lifetime payments for continuous total disability. They pay 100% of the $5000 benefit if total disability starts at 45 or less. The lifetime benefit is gradually reduced with age. e.g if total starts at age 50, they will pay only 75% of the benefit for life. if it starts at age 55 then they will pay 50% of the benefit, if it starts at age 60 then they will pay only 25% of the benefit

I want to keep the coverage around $5000/month

I would welcome any input. Its hard for me to make a decision because of the differences in the policies and unpredictability of what we are dealing with

Posts: 2809
Joined: Thu Dec 30, 2010 12:28 am
Location: Las Vegas

Re: Disability insurance question

Post by BruDude » Fri Mar 24, 2017 12:38 am

The lifetime benefit is pretty expensive these days, only Guardian offers it. That policy today would probably cost you almost twice as much for lifetime benefits. On the other hand, the 24-month recovery benefit limitation sucks. It really depends how much you value the lifetime benefit.

Post Reply