Any-occupation disability insurance pays you if you are unable to work any type of job due to your disability, but if you are capable of working at all, your coverage won’t pay out, even if the work is different from your previous profession or pays significantly less than your old job.
Any-occupation disability insurance provides less coverage than some other types of disability insurance, but it is also less expensive—sometimes significantly so.
What is an any-occupation disability insurance policy?
If you are hurt, sick, or injured and unable to work because of it, disability insurance helps replace part of your income.
When you buy a long-term disability policy, you’ll choose the type of coverage you want, including your policy’s “definition of disability,” meaning the conditions under which the insurance policy will pay out.
Any-occupation disability insurance is a type of long-term disability insurance policy that covers you only if you are completely unable to work, “any-occupation” is just the term for the way disability is defined in that type of policy.
Any-occupation disability insurance operates with a very narrow definition of what is considered a disability, and won’t pay out if you are capable of working any type of job, even if it is in another industry or pays significantly less than you were earning previously.
How does any-occupation disability insurance work in real life?
Let’s say that you’re a banker. If you have a stroke that leaves you paralyzed, you would likely qualify for payments under an any-occupation disability insurance policy because it would be considered a total and permanent disability that prevents you from doing any type of work.
But if you end up with brain fog as a symptom of long COVID and your math skills deteriorate because of it, your any-occupation disability insurance claim would probably be denied because there are other jobs you could do that don’t require that particular skill.
To file a claim for something like brain fog you would need to have an own-occupation disability policy, which pays out even if you’re still able to do a different type of job.
Who should get any-occupation disability insurance?
Long term disability insurance is worth it for most people, but how do you know which type of policy is right for you?
An any-occupation disability insurance policy offers less protection than an own-occupation disability policy, but it can be a good choice for some applicants. Here are some examples of people who might be fine choosing any-occupation disability insurance coverage:
1. People who need affordable coverage
If you don’t have a lot of discretionary income but you still want to protect yourself financially in case you’re unable to work in the future, any-occupation disability insurance will meet your needs at a lower price than own-occupation disability insurance.
2. People who are most worried about total disability
If you are the kind of person who can’t fathom not working in some way, or if you don’t mind the idea of switching to a different career after a partial disability, any-occupation disability insurance would be a good fit for your needs.
3. People who are qualified to do many different types of jobs
While own-occupation disability insurance is best for people who have invested a significant amount of time and money to do one specific job, any-occupation disability coverage is a great choice for people who take more of a jack-of-all-trades approach to their career.
If you would be just as happy providing in-home health care as you would processing data or working in a call center, any-occupation disability coverage might be the right choice for you.
Any-occupation vs own-occupation disability insurance
Both any-occupation and own-occupation disability insurance provide coverage if you are unable to work due to disability, but there are significant differences between the two types of coverage.
Any-occupation insurance | Own-occupation insurance |
|---|---|
Only provides coverage if you are unable to work any type of job | Provides coverage if you are unable to work in your current profession, even if you can work a different type of job somewhere else |
If you take a job after filing a claim your payments will be cut off | You can continue receiving payments from your disability policy even if you take another job as long as it isn't in your current line of work |
Cheaper than own-occupation insurance | More expensive than any-occupation insurance |
Because of the limitations associated with an any-occupation disability insurance policy, if you have a job that requires significant training or education, pays significantly more than you could earn elsewhere, or where your skills don’t transfer easily to another industry, own-occupation coverage is a better choice.
Where can you get any-occupation disability insurance?
Many people have some amount of disability insurance available as a benefit through their employer, but you can also purchase coverage separate from your employee benefits.
You can get a personal any-occupation disability insurance policy directly through an insurance company that offers disability coverage or by comparing quotes from multiple companies with Policygenius.
Some of the best disability insurance companies are:
What we like … | BBB rating | AM Best rating | |
|---|---|---|---|
Includes a survivor benefit for your beneficiary if you pass away. | A+ | A | |
Offers lifetime continuous benefits for total disabilities, even after the policy expires. | A+ | AA+ | |
Offers a future insurability rider that's good until your 60th birthday. | A | A++ | |
Offers a lump-sum payment of $62,400 in addition to regular benefits if you're presumptively disabled. | A+ | A+ | |
Includes a family care benefit if you have to take time off to care for a sick loved one. | A+ | A |
Getting your own any-occupation disability insurance coverage gives you more control over your finances. It allows you to take your coverage with you from one job to another, you won’t lose your coverage if you lose your job, and you have more control over the details of your plan, like coverage amounts and the length of your policy.
For example, most disability plans through your employer limit your coverage to 66% of your salary and have a cap on how long your coverage will stay in effect after filing a claim, whereas a policy you own could offer a higher amount of coverage that could make payments for many years.
But every company has their own internal rules and systems, so make sure you know how an insurance company defines disability before buying coverage.
How much does any-occupation disability insurance cost?
Generally speaking, any-occupation disability insurance costs somewhere between 1% and 3% of your annual salary. So if you earn $110,000 a year, you might pay somewhere between $92 and $275 a month for a disability policy.
The actual amount you’ll pay for coverage depends on a number of factors, including your age, overall health, income, and what type of job you have.
Any-occupation disability insurance is less expensive than own-occupation disability insurance, which could cost an extra $100 a month (or more) due to the higher likelihood of paying a claim.
Frequently asked questions
What is occupational disability?
An occupational disability is something that stops you from doing your job and cannot be changed or accommodated. For example, a surgeon who develops a tremor in their hands would have an occupational disability, while a surgeon who develops a latex allergy likely would not have an occupational disability because they could switch to non-latex gloves and other products in their office.
Is any-occupation disability insurance worth it?
The most valuable asset most people have is their ability to earn a living, so disability insurance is a good way to protect yourself financially. Any-occupation disability insurance helps protect your income if you are unable to work at all, but doesn’t pay anything if you are capable of working a job that is different from the one you were doing when you became disabled. People who could not earn a similar income in another job or industry should consider own-occupation disability insurance instead.
What are the three types of disability insurance?
Most people think there are three types of disability insurance: short-term disability, long-term disability, and federal or state disability. But there are actually many other types of disability insurance as well, including personal and group disability insurance, mortgage disability insurance, Social Security disability insurance, and workers compensation.
