Disability Insurance Calculator
Long-term disability insurance replaces a portion of your income — typically 50% to 70% — if you can't work due to illness or injury, and for most working adults the risk of a disability before retirement actually exceeds the risk of death, which makes this coverage essential yet frequently overlooked. Your ability to earn an income is your largest asset by far, and protecting it deserves the same attention you'd give to insuring a home or a car. This calculator estimates your monthly and annual benefit based on your income and a replacement rate, plus the premium to insure that income. Enter your annual gross income, the benefit replacement percentage (typically 50% to 70%), the premium rate per $100 of income, and the elimination period (the waiting time before benefits begin), and the calculator returns your monthly benefit and your premium. Check your employer coverage first, because group plans often replace only 60% of income and may be taxable (reducing the actual benefit), so consider supplemental individual coverage to fill the gap and to provide coverage that stays with you if you change jobs. The elimination period is the waiting time between disability and when benefits begin — typically 30, 60, or 90 days — and a longer elimination period lowers your premium because you're self-insuring the early weeks. Insurers cap the replacement percentage at 50% to 70% because they want you to have an incentive to return to work. Short-term disability covers weeks to months, while long-term disability covers years or to retirement, and long-term is the more critical coverage for catastrophic risk. For most working adults, disability insurance is worth it: the chance of a disability lasting 90 or more days before retirement is significant, and lost income can derail your finances for years. Use this calculator to estimate income replacement if disabled, see the premium to protect your income, and choose benefit and elimination periods that fit your budget and risk.
Disability Insurance Calculator
Estimate long-term disability benefits and the premium to insure your income.
Monthly benefit
$4,500
60% of income
Annual benefit
$54,000
Monthly premium
$150
Long-term disability insurance replaces a portion of your income if you can't work due to illness or injury. For most workers, the risk of disability before retirement exceeds the risk of death — making this coverage essential.
How to Use This Calculator
- 1Enter your annual gross income.
- 2Enter the benefit replacement percentage (typically 50-70%).
- 3Enter the premium rate per $100 of income.
- 4Enter the elimination period (waiting days).
- 5Read your monthly benefit and premium.
Why It Helps
- ✓Estimates income replacement if disabled.
- ✓Shows the premium to protect your income.
- ✓Highlights an often-overlooked risk.
- ✓Helps choose benefit and elimination periods.
About This Calculator
Long-term disability insurance replaces a portion of your income — typically 50% to 70% — if you can't work due to illness or injury, and for most working adults the risk of a disability before retirement actually exceeds the risk of death, which makes this coverage essential yet frequently overlooked. Your ability to earn an income is your largest asset by far, and protecting it deserves the same attention you'd give to insuring a home or a car. This calculator estimates your monthly and annual benefit based on your income and a replacement rate, plus the premium to insure that income. Enter your annual gross income, the benefit replacement percentage (typically 50% to 70%), the premium rate per $100 of income, and the elimination period (the waiting time before benefits begin), and the calculator returns your monthly benefit and your premium. Check your employer coverage first, because group plans often replace only 60% of income and may be taxable (reducing the actual benefit), so consider supplemental individual coverage to fill the gap and to provide coverage that stays with you if you change jobs. The elimination period is the waiting time between disability and when benefits begin — typically 30, 60, or 90 days — and a longer elimination period lowers your premium because you're self-insuring the early weeks. Insurers cap the replacement percentage at 50% to 70% because they want you to have an incentive to return to work. Short-term disability covers weeks to months, while long-term disability covers years or to retirement, and long-term is the more critical coverage for catastrophic risk. For most working adults, disability insurance is worth it: the chance of a disability lasting 90 or more days before retirement is significant, and lost income can derail your finances for years. Use this calculator to estimate income replacement if disabled, see the premium to protect your income, and choose benefit and elimination periods that fit your budget and risk.
Disclaimer: This calculator provides estimates for educational purposes only and does not constitute financial, tax, or investment advice. Results depend on assumptions that may not reflect your actual situation.
Frequently Asked Questions
Do I need disability insurance if I have it at work?
Check your employer coverage. Group plans often replace only 60% of income and may be taxable. Consider supplemental individual coverage to fill gaps.
What is the elimination period?
The waiting time between disability and when benefits begin — typically 30, 60, or 90 days. A longer elimination period lowers your premium.
What percentage of income does disability insurance replace?
Typically 50-70% of gross income. Insurers cap it because they want you to have an incentive to return to work.
Short-term or long-term disability — which do I need?
Both cover different periods. Short-term covers weeks to months; long-term covers years or to retirement. Long-term is more critical for catastrophic risk.
Is disability insurance worth it?
For most working adults, yes. The chance of a disability lasting 90+ days before retirement is significant, and lost income can derail your finances.
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Written by
James MitchellSenior Financial Analyst & Personal Finance Expert
Certified Financial Planner (CFP) • MBA in Finance, University of Chicago Booth School of Business