Personal Finance

Without knowing the costs, it sounds like you’re good candidates for the supplemental life or even an additional life policy. A year of salary can go quite quickly, as can the time and the costs of taking it off work. Term can be fine to start with, then later in life as it becomes a larger concern (especially with kids) you may consider whole life. But if you have substantial liquid savings, then you might just be fine with the 1-1.5x coverage for now. Once again, just all about your risk tolerance and savings.

Disability is very difficult to plan for and make a purely rational decision about. There are so many moving factors with the medical costs and length of the problem. For people who want total security, that $700 can be well worth it to sleep soundly. For others with more savings and a little room in their finances to cut back expenses, it might not be worthwhile. The more savings and the more you can rely on your partner for income, the less important it is.

But tackling it from a quantitative perspective may help. For $700, you’re getting 20% of your income. It’s a low-cost premium because the risk is usually low (unless you have reason to believe you’re likely to become disabled). You can also shop for separate plans to see how the premium lines up against competitors. It’s also important to understand the elimination period (how long you have to wait before you can claim benefits) and if it will pay out if you can perform ANY job vs your actual profession.

This is a pretty decent article on an approach to disability coverage: https://www.usbank.com/financialiq/plan-your-future/health-and-wellness/is-your-employer-long-term-disability-insurance-enough.html