Long-Term Disability Insurance - Millennial

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills.
Post Reply
Topic Author
indexer01
Posts: 6
Joined: Mon Aug 27, 2018 4:51 pm

Long-Term Disability Insurance - Millennial

Post by indexer01 »

Hi everyone!

After reading this forum for many years and absorbing lots of investing knowledge, I now need some guidance on non-investment matters. I've decided that it makes sense for me to get long-term disability insurance. It is currently not offered by my employer, and in the case that something happens to put me out of work permanently, I would certainly need more than government assistance. I have a disabled sister that will eventually be my financial responsibility when my mother passes (hopefully that is several decades away), and would not want to be in a resource-less situation.

I am completely new to researching insurance, so I'm going to give some basic details about me in case they help:

Age/Gender: 28 y.o. male
Gross Annual Salary: $77.5k
State of residence: Florida

And I suppose my questions are these:

1) What is the range of monthly payments I'm looking at that would be considered reasonable? (I do have some pre-existing medical conditions that might bump up the price)
2) Are there any good companies I should start with?
3) What riders, if any, should I look at?

Thanks so much in advance, and I'd be happy to give more info if that helps anyone guide me in the right direction :D
runninginvestor
Posts: 1796
Joined: Tue Sep 08, 2020 8:00 pm

Re: Long-Term Disability Insurance - Millennial

Post by runninginvestor »

I'm glad you are thinking about these things, especially as it's not just being offered to you. Which usually lead people to never think about these things. I know there are knowledgeable people that will respond with your specifics. In the meantime, glance at the wiki:
https://www.bogleheads.org/wiki/Disability_insurance

There are also some links to the white coat investor series in this thread, that were recommended:
viewtopic.php?t=243306
runninginvestor
Posts: 1796
Joined: Tue Sep 08, 2020 8:00 pm

Re: Long-Term Disability Insurance - Millennial

Post by runninginvestor »

As a side note, sorry to hear about your familial disability situation. Has your family looked into the pros and cons for ABLE Accounts? If not, may want to search the forum or start a different thread for more information on that.
Topic Author
indexer01
Posts: 6
Joined: Mon Aug 27, 2018 4:51 pm

Long-Term DI and Pre-Existing Conditions

Post by indexer01 »

[Thread merged into here --admin LadyGeek]

Hi everyone,

I posted a while back about obtaining private long-term disability insurance coverage, since it is not offered by my employer. I have started an application with Northwestern Mutual, and am at the stage of the medical exam/questionnaires. I'm 29 years old, with a stable income and work in a low-risk office job.

I have a form of arthritis (very well-controlled), as well as visits to a podiatrist and orthopedic doctor due to foot and neck pain (unrelated to the arthritis). I was prescribed physical therapy for the neck pain, but didn't go due to the pain improving. I did have a pretty serious mental health diagnosis from when I was a teenager, but a recent, updated evaluation had that diagnosis removed from my medical records as being inaccurate.

I understand that I will have exclusions based on this, but also know I could be outright denied coverage. My question is: will a denial hurt me in the long-run from trying to obtain coverage from another provider? My other question is: should I even try? I did contact one insurance company that flat-out said they wouldn't cover me with an arthritis diagnosis, but could offer me a plan that would pay me for 10 years if I were disabled.

I've dealt with headaches with health insurance before in trying to have medications covered. This is very different, but I suppose I have a bit of PTSD from it whenever dealing with any form of insurance.

Thanks for any guidance! Really appreciate you all.
User avatar
chasingbutterflies
Posts: 96
Joined: Fri Apr 17, 2015 1:19 pm

Re: Long-Term DI and Pre-Existing Conditions

Post by chasingbutterflies »

I also have arthritis and getting DI is going to be hard. They aren't going to want to cover you. I used a broker (I'm a physician and found her on the White Coat Investors website). She checked Northwestern Mutual (denied flat out) and Principal and Guardian. I eventually chose Principal but I'm only covered for 5 years and any musculoskeletal complaint is excluded. There is also an exclusion on neck complaints (I was seeing a chiropractor at the time). Don't mention the mental health condition at all. It's not on your current records (they will get them) and shouldn't count against you as long as you don't mention it. Be truthful but don't offer any extra information they can use to put more exclusions on. I mentioned the chiropractor during the health exam and... exclusion. In this situation I do recommend using a broker as they can better target companies and get you the best deal, avoiding certain rules that would make the insurance essentially useless, and expensive.
User avatar
chasingbutterflies
Posts: 96
Joined: Fri Apr 17, 2015 1:19 pm

Re: Long-Term DI and Pre-Existing Conditions

Post by chasingbutterflies »

Should have answered your question! I don't think the denial will count against you but that's another reason to use a broker as they can do multiple enquiries at the same time.
User avatar
LadyGeek
Site Admin
Posts: 95686
Joined: Sat Dec 20, 2008 4:34 pm
Location: Philadelphia
Contact:

Re: Long-Term Disability Insurance - Millennial

Post by LadyGeek »

Indexer01- In order to provide appropriate advice, it's best to keep all the information in one spot. I merged your update back into the original thread. If you have any questions, ask them here.

(Thanks to the member who reported the post and provided a link to this thread.)
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.
BruDude
Posts: 4211
Joined: Wed Dec 29, 2010 11:28 pm
Location: Las Vegas

Re: Long-Term DI and Pre-Existing Conditions

Post by BruDude »

indexer01 wrote: Mon Jul 26, 2021 10:38 am [Thread merged into here --admin LadyGeek]

Hi everyone,

I posted a while back about obtaining private long-term disability insurance coverage, since it is not offered by my employer. I have started an application with Northwestern Mutual, and am at the stage of the medical exam/questionnaires. I'm 29 years old, with a stable income and work in a low-risk office job.

I have a form of arthritis (very well-controlled), as well as visits to a podiatrist and orthopedic doctor due to foot and neck pain (unrelated to the arthritis). I was prescribed physical therapy for the neck pain, but didn't go due to the pain improving. I did have a pretty serious mental health diagnosis from when I was a teenager, but a recent, updated evaluation had that diagnosis removed from my medical records as being inaccurate.

I understand that I will have exclusions based on this, but also know I could be outright denied coverage. My question is: will a denial hurt me in the long-run from trying to obtain coverage from another provider? My other question is: should I even try? I did contact one insurance company that flat-out said they wouldn't cover me with an arthritis diagnosis, but could offer me a plan that would pay me for 10 years if I were disabled.

I've dealt with headaches with health insurance before in trying to have medications covered. This is very different, but I suppose I have a bit of PTSD from it whenever dealing with any form of insurance.

Thanks for any guidance! Really appreciate you all.
Being denied won't count against you applying with other insurers, but you'll have to explain why the app was denied. If you have rheumatoid arthritis you are going to get declined, psoriatic arthritis is likely a decline, general arthritis might be workable with an exclusion. If you are on any specialty medications for psoriatic arthritis it's a decline. A "pretty serious mental health diagnosis" could be a major issue. If it was bipolar, major depression, or any history of suicide attempts, all of the "top tier" DI companies are probably going to decline to offer any coverage even if it was over 10 years ago. Just being honest but this sounds like a very tough case to get through underwriting.

Illinois Mutual and Fidelity Security are two companies that specialize in impaired-risk cases that might be an option if you can't get traditional coverage.
BruDude
Posts: 4211
Joined: Wed Dec 29, 2010 11:28 pm
Location: Las Vegas

Re: Long-Term DI and Pre-Existing Conditions

Post by BruDude »

chasingbutterflies wrote: Mon Jul 26, 2021 11:48 am I also have arthritis and getting DI is going to be hard. They aren't going to want to cover you. I used a broker (I'm a physician and found her on the White Coat Investors website). She checked Northwestern Mutual (denied flat out) and Principal and Guardian. I eventually chose Principal but I'm only covered for 5 years and any musculoskeletal complaint is excluded. There is also an exclusion on neck complaints (I was seeing a chiropractor at the time). Don't mention the mental health condition at all. It's not on your current records (they will get them) and shouldn't count against you as long as you don't mention it. Be truthful but don't offer any extra information they can use to put more exclusions on. I mentioned the chiropractor during the health exam and... exclusion. In this situation I do recommend using a broker as they can better target companies and get you the best deal, avoiding certain rules that would make the insurance essentially useless, and expensive.
The mental health history has to be disclosed. Every DI app asks about major depression/bipolar/anxiety/etc in your lifetime, not just the last 10 years. They will also see it coded in the MIB and prescription check history will show what Rx was used.
User avatar
MillennialFinance19
Posts: 586
Joined: Sat Feb 09, 2019 10:06 am

Re: Long-Term DI and Pre-Existing Conditions

Post by MillennialFinance19 »

indexer01 wrote: Mon Jul 26, 2021 10:38 am
I have a form of arthritis (very well-controlled), as well as visits to a podiatrist and orthopedic doctor due to foot and neck pain (unrelated to the arthritis).
Have fun. I have Degenerative Disc Disease (DDD) and started applying for policies at 30 years old. All of them either denied me or wanted to eliminate my entire back and increase premiums. It wasn't worth it. Good luck, hope you have a better run at it!
VTI and chill until 57...
User avatar
chasingbutterflies
Posts: 96
Joined: Fri Apr 17, 2015 1:19 pm

Re: Long-Term Disability Insurance - Millennial

Post by chasingbutterflies »

I have psoriatic arthritis and am on a biologic. I got covered. However had a lot of exclusions as I said. It is possible. Good luck!
User avatar
Tamarind
Posts: 2810
Joined: Mon Nov 02, 2015 1:38 pm

Re: Long-Term Disability Insurance - Millennial

Post by Tamarind »

I think the very rough rule is that you should expect to pay 1-3% of salary annually to have 80% of your salary covered. This varies depending on your sex, age, and health.

My experience with underwriting for individual LTD was lousy but could have been worse.

Probably the most frustrating was them insisting they would not cover skin cancer unless I went back to a dermatologist because I'd had a normal mole removed 9 years prior, and the words "follow up as needed" appeared in the doctors notes. The dermatologist was annoyed but wrote a very clear note and I got the exclusion lifted a couple months into the policy.

They seem to freak out more about past issues that they think you might not be getting sufficient treatment for, than they do about some chronic conditions that are clearly well controlled with medication. But anything statistically unusual for your age will set them off.

Be persistent and be ready to get new notes from your docs.
Post Reply