Should You Get Disability Insurance While Still in Training?

Medical residents and fellows are often advised to purchase disability insurance before finishing training—but it’s reasonable to ask: why?

After all, adding another expense can feel daunting, if not irresponsible. Understanding the reasons behind this advice can help you decide whether it actually makes sense for your situation.

Why trainees often consider disability insurance

Discounted pricing

One of the most common reasons cited for purchasing disability insurance during residency or fellowship is access to discounted pricing.

At many institutions, trainees qualify for discounts ranging from 10% to 30%, depending on specialty and state of residence. These discounts are typically permanent, meaning they stay with your policy after graduation and often apply to future increases as your income grows.

Most insurance companies also allow a short window after graduation—often a few months—during which you can still qualify for your training institution’s discount. If purchasing coverage during training isn’t feasible, applying shortly after graduation may still allow you to lock in reduced rates.\

Generally stronger protection than employer coverage

A common counterargument is that physicians already receive employer-provided long-term disability insurance while training in an ACGME-accredited program.

Like most employer-provided (or “group”) disability policies, this coverage typically does notinclude a true own-occupation definition of disability. Policy language often states that you are considered totally disabled only if you cannot perform the duties of your occupation and are unable to work in any other occupation for which you are reasonably qualified based on education, training, or experience.

Many physicians prefer stronger protection—commonly available through individual disability policies—known as true own-occupation coverage. Under this definition, you are considered totally disabled if you cannot perform the material and substantial duties of your occupation, even if you are gainfully employed in another role. If your occupation is limited to a single medical specialty, that specialty is considered your occupation under the policy.

Portable coverage that grows with you

Once physicians agree that discounts and own-occupation protection are worth considering, the next question is often: What happens after training?

Individual disability insurance policies are portable, meaning they follow you throughout your career—into fellowship, attending practice, or even job changes. The policy is yours to keep for as long as you continue to pay the premium.

Policies purchased during training often start with a relatively modest benefit amount, keeping costs manageable. Most also include future increase options, allowing you to increase coverage later—without additional health questions—as your income rises and your budget becomes more flexible.

State and age considerations

Disability insurance is regulated and priced at the state level, not federally. While pricing is similar across most states, a few impose additional premium surcharges.

Policies issued in California, Arizona, and Nevada are, on average, typically 20–30% more expensive than those issued elsewhere. If you anticipate moving to or from one of these states, it may be worth reviewing your options. Purchasing a policy before relocating—or shortly after leaving—can sometimes result in long-term savings, assuming you remain within eligibility windows for discounts or trainee programs.

Disability insurance premiums are also based partly on age—the younger you are when you buy, generally the lower the cost.

That said, purchasing earlier also means paying premiums for a longer period, which often balances out over time. If none of the other factors resonate with you, age alone usually shouldn’t be the primary reason to purchase coverage during training.

Special coverage limits for physicians

As a general rule, disability insurance companies will not insure more than 60% of your pre-tax income. However, physicians in training—and often for a short period after becoming an attending—qualify for Special Limits of coverage.

Most residents are eligible for up to $5,000 per month in income tax-free disability benefits, regardless of income and regardless of employer-provided coverage. During your final year of residency, throughout fellowship, or within your first two years as an attending, eligibility often increases to $8,000 per month.

In some scenarios, a physician could receive benefits from both an employer-provided policy and an individual policy simultaneously. Assuming each policy’s definition of disability is met, these benefits are typically not offset, potentially resulting in total income replacement exceeding 100% of prior earnings.

Guaranteed Standard Issue (GSI) opportunities

If you decide it makes sense to explore disability insurance during training, the next step is applying for coverage.

Unfortunately, nearly two out of three physicians who apply for individual disability insurance are either declined or receive exclusions, higher premiums, or other penalties due to health history.¹

For trainees at select institutions, Guaranteed Standard Issue (GSI) programs may be available. These programs allow eligible residents and fellows to obtain a true own-occupation, specialty-specific policy with no health questions, no medical exam, no premium surcharge, and no risk of being declined.

GSI programs are generally only available during training and are typically unavailable after graduation. Importantly, once you formally apply for an individual policy and disclose your health history, you become ineligible for GSI.

The bottom line

Paying for insurance you hope you never need is rarely a top priority during training. Individual disability insurance isn’t for everyone, but many physicians choose to secure coverage early to take advantage of discounts, special limits, and GSI programs that are often only available during residency or fellowship.