Hello, guys. If this post is appealing, please let me know. I obtained guardian disability through an agent (who provided me options but pushed for guardian, which I felt would result in a higher payout), and I pay $143 per month for $5,000 in coverage. I received the resident discount, which is true for my occupation, benefit purchase rider, and COLA. Got authorised for an increase in coverage from 11k to 16k each month. I have to take at least half, therefore I am thinking about adding $6,000 for $11,000 in coverage for $320 per month.
I prefer your current coverage because it costs less per $1,000 ($28.60) compared to the proposed additional coverage ($29.09). While the difference is relatively small, it’s important to consider whether the extra coverage justifies the slightly higher cost. Remember, insurance decisions are personal and should be based on your individual circumstances, including factors like your occupation, health status, and financial situation.
The cost of long-term disability insurance from Guardian Life can vary significantly depending on several factors. The premium range mentioned is $25 to $500 per month, with a general guideline that the policy may cost 1-3% of your income. In your specific case, you are paying $143 per month for $5,000 in monthly coverage, which seems reasonable given the resident discount and other riders you have added. The increase to $11,000 in monthly coverage for $320 per month also appears to be within the typical cost range, though on the higher end. Ultimately, the “right” price for long-term disability insurance depends on your circumstances, including your income, occupation, health status, and the specific policy features you require. It’s important to shop around and compare quotes from multiple insurers to ensure you are getting a fair rate. The key is finding the right balance of coverage and cost to protect yourself financially in the event of a disability.
According to Jim Dahle’s recommendations, a good policy should cost roughly 4% of the benefit; I’ve seen him also mention 2-6%. Your quoted price of $320 each month for a $11,000 benefit per month works out to 3%, so that’s a good quote. I hope this is useful.
Determining whether the price is reasonable or too high depends on several factors:
Assessing Your Specific Circumstances:
Age and Health: Generally, younger and healthier individuals tend to have lower premium rates.
Occupation: Certain high-risk occupations can lead to higher premiums due to increased likelihood of disability.
Policy Details: Specific aspects such as elimination period and benefit duration can influence the cost of the policy.
Exploring Alternatives: Comparing quotes from other reputable disability insurance providers can provide insights into market rates.
Here’s a breakdown based on your information to help evaluate:
Current Coverage: You currently have $5,000 monthly coverage for $143, equating to approximately 2.86% of your coverage amount.
Proposed Increased Coverage: Considering adding $6,000 for a total of $11,000 coverage, with a new premium of $320, resulting in about 2.91% of your increased coverage amount.
Initially, the cost increase appears proportionate to the coverage increase. To determine overall affordability:
Shop Around: Obtain quotes from different disability insurance providers offering similar coverage levels to gauge competitiveness.
Review Policy Specifics: Understand crucial details like elimination periods, benefit durations, and any exclusions or limitations.
Assess Your Requirements: Determine if $11,000 monthly coverage meets your financial needs, considering living expenses and financial commitments.