Disability Insurance for Self Employed
Over 100 Carriers to Quote From. Here are a few of them!
As a self-employed professional, your income depends entirely on your ability to work. Without employer benefits, a sudden illness or injury can stop revenue overnight—while rent, payroll, and personal bills keep coming. That’s why Disability Insurance for Self-Employed professionals is essential: it replaces a portion of your income so you can focus on recovery without risking your business or lifestyle.
Why Disability Insurance Matters for Entrepreneurs
Picture a consultant earning $120,000 per year. A back injury sidelines them for six months—$60,000 in lost revenue before overhead. Disability insurance provides a monthly benefit during a qualifying disability, helping you maintain household cash flow, preserve client relationships, and protect the enterprise you’ve built.
Protect Your Income with Disability Insurance
We’ll compare options from 100+ top carriers and tailor coverage to your occupation and income.
Coverage Types Built for the Self-Employed
- Individual Disability Insurance (IDI): Monthly, tax-efficient benefits if a covered sickness or injury prevents you from working. Benefit amounts, waiting periods, and durations are customizable.
- Own-Occupation Definition: Pays benefits if you cannot perform the material and substantial duties of your specific occupation—even if you can do other work.
- Business Overhead Expense (BOE): Reimburses fixed expenses like rent, utilities, software, and staff wages while you’re disabled, so your business can keep operating.
- Partial/Residual Riders: Provides proportionate benefits when you can work part-time or return with a loss of income.
- Future Increase Options: Lets you raise coverage later as your income grows—without new medical underwriting.
How Much Coverage Do You Need?
Most self-employed professionals target 60%–70% of pre-disability earnings, with a 30–90 day elimination period and benefits payable to age 65–67 (or longer). The optimal design depends on your taxes, savings cushion, recurring overhead, and whether you need BOE in addition to personal income protection. Our licensed advisors (all 50 states) can model multiple structures—and price points—side-by-side.
Case Example
Mark, 42, general contractor ($95,000/yr): A fall required surgery and nearly a year off work. His policy paid $4,500/month in benefits, covering the mortgage and key business costs so he could recover and retain clients. Without coverage, he risked draining savings and losing the business.
Who Benefits Most?
- Freelancers and consultants without employer disability benefits
- Owners with fixed overhead (leases, software, assistants, subcontractors)
- Professionals with specialized skills/licenses (designers, advisors, clinicians)
- Contractors and trades with higher injury exposure
Lock In Reliable Income Protection
Compare disability coverage from 100+ carriers and tailor it to your self-employed lifestyle.
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FAQs: Disability Insurance for Self-Employed
What counts as a disability?
Policies define disability by your ability to perform your job duties. With own-occupation coverage, you can qualify even if you can work in another role.
How are benefits taxed?
If you pay premiums personally with after-tax dollars, benefits are typically received tax-free. BOE benefits are usually taxable but deductible as a business expense. Consult your tax professional.
What elimination period should I choose?
Common waiting periods are 30–90 days. Shorter waits cost more but start benefits sooner—use your emergency fund and cash flow to decide.
Can I get coverage with fluctuating income?
Yes. Carriers typically use recent tax returns to verify earnings and set benefit amounts. Riders like residual/partial benefits can help when income drops but you’re not fully disabled.
Do I need BOE insurance in addition to personal disability?
If you have fixed overhead (rent, software, staff), BOE can keep your business running while your personal policy replaces your household income.
Can I increase coverage later?
Many policies offer future increase options that let you raise benefits as your income grows—often without new medical underwriting.
What if I work in a higher-risk trade?
You can still qualify. We’ll match carriers to your occupational class and design benefits and riders appropriate for your risk profile and budget.
About the Author:
Jason Stolz, CLTC, CRPC, is a senior insurance and retirement professional with more than two decades of real-world experience helping individuals, families, and business owners protect their income, assets, and long-term financial stability. As a long-time partner of the nationally licensed independent agency Diversified Insurance Brokers, Jason provides trusted guidance across multiple specialties—including fixed and indexed annuities, long-term care planning, personal and business disability insurance, life insurance solutions, and short-term health coverage. Diversified Insurance Brokers maintains active contracts with over 100 highly rated insurance carriers, ensuring clients have access to a broad and competitive marketplace.
His practical, education-first approach has earned recognition in publications such as VoyageATL, highlighting his commitment to financial clarity and client-focused planning. Drawing on deep product knowledge and years of hands-on field experience, Jason helps clients evaluate carriers, compare strategies, and build retirement and protection plans that are both secure and cost-efficient.
