How Much Does Short-Term Disability Insurance Cost?

How much does short-term disability insurance cost per month? Use a simple calculator to estimate premiums instantly for a variety of policy configurations.

Multiple policy feature choices and risk factors associated with the applicant move the estimate up or down. Look up each of these elements to see how they affect premium rates.

Request a quote from a licensed agent once you identify the configuration that fits your budget.

Afterward, take the same analysis to workplace-based policies to determine what it costs employers to offer short-term disability to employees – the maternity benefits are far better!

Short-Term Disability Cost Calculator

Use the short-term disability insurance calculator to estimate the premium cost per month for individual coverage. Multiple features that people choose at policy application time affect the ultimate number. In addition, the profile of the applicant influences the overall risk rating.

Request a short-term disability quote once you have a base estimate for your ideal configuration. An agent licensed in your state may contact you.

Request a short-term disability quote now that you have an idea for your ideal configuration. An agent licensed in your state may contact you. Each insurance company uses unique underwriting rules. Expect the final premiums to vary from this sample estimator tool.

Policy Features

The individual short-term disability policy features that you select at the time of application play a major role in calculating the premium cost per month. This is why the average figures are misleading. There are many possible policy configurations leading to a wide range of outcomes.

The three major feature choices are the benefit period, elimination period, and monthly benefit.

Benefit Period

The policy benefit period is the first applicant choice affecting costs. The benefit period defines how long the plan will make claim payments during the time you remain unable to work because of a covered medical condition.

You choose between several benefit period options at the time of application. Of course, the longer the claims payments last, the higher your premiums will be.

Benefit PeriodRating Factor
3 Months.6
6 Months.7
12 Months1
24 Months1.3

Elimination Period

The policy elimination period is the second applicant choice affecting the cost. The elimination period defines how quickly claim payments begin after a covered loss.

You can choose between multiple elimination period options when applying for coverage. Shorter elimination periods generate more claims. Therefore, longer elimination periods have more affordable premiums.

Elimination PeriodRating Factor

Insurance companies express this feature as the number of days for accidents/number of days for illnesses.

Monthly Amount

The policy monthly benefit amount is the last applicant choice affecting costs. The monthly benefit amount defines how much the plan pays in the event of a covered loss.

You choose the monthly benefit amount at the time of new policy application. Insurance companies allow applicants to cover up to the lesser of two figures.

  • Percentage of income (70% maximum) is common
  • Hard dollar cap ($6,500 per month limit) is common

You can opt to cover less than the full amount in order to make the premiums more affordable. The math uses simple multiplication.

$4,000 amount costs 2X the $2,000 amount

Applicant Factors

Applicant risk factors also play a major role in the short-term disability premium cost per month calculation. Each individual presents unique probabilities of filing a future claim. Therefore, insurance companies adjust their rates based on an applicant’s occupation, age, smoking behavior, and sometimes overall health.


Your occupation or industry influences the probability of a future claim and the rate you must pay. For example, a person working in a physically demanding job role is more likely to stop working and file a claim because of a broken bone than someone in a white-collar role is.

Occupation ClassificationRating Factor


Your age at the time of application also impacts the chances of a future claim and the rate you must pay. For example, older people are more likely to contract a serious illness that prevents them from working for an extended period.

Age RangeRating Factor
18 – 35.8
36 – 45.9
46 – 551
56 – 651.2


Your tobacco use also influences the probability of a future claim and the rates you must pay. For example, smokers are more likely to contract cancer or lung disease that hampers their ability to work.

Tobacco UseRating Factor

Average Figures

The average cost per month of individual short-term disability provides a sample premium calculation. Insurance agents often set an expectation that the typical person pays one hour’s wage per week to cover their paycheck.

For example, a person earning $41,600 annually makes $20 per hour. There are 4.3 weeks in the average month (30/7=4.3) Therefore, the typical premium is about $86. We can arrive at this average figure by multiplying the rating factors for the key inputs.

Benefit Period12 Months11
Elimination Period30/3011
Age46 – 5511
Tobacco UseNon-Smoker11
Monthly Benefit$2,40086$86

Short-Term Disability Costs for Employers

The premium cost per month of short-term disability insurance for employers has a very wide range. The reason is threefold. Apply the figures noted above to estimate what your organization might spend to make this benefit available to its workforce.

  1. Some employers pay 100% of the premiums for group plans
  2. Voluntary policies are 100% employee paid
  3. Other options fall somewhere in the middle of the two

Only employer-based policies cover recovery from labor and delivery – an important maternity leave benefit. Therefore, knowing the employer costs is critical when asking to make the option available at work.

Voluntary Plans

The direct cost for employers to offer voluntary short-term disability is zero. Employees pay the premiums themselves via payroll deduction. In fact, pre-tax deductions can actually reduce employer payroll taxes – thus saving them money.

Three different indirect employer costs for voluntary policies are very modest.

  1. Allow insurance agents to conduct yearly group meeting to educate employees
  2. Permit insurance agents to meet one-on-one with employees
    1. Counsel each person individually
    2. Complete applications
    3. Capture payroll elections.
  3. The employer must support a payroll deduction
    1. Withhold money from employee paychecks
    2. Send money withheld to the insurer once per month
    3. Notify the insurer of changes in employee status

Group Plans

The group short-term disability cost per month for employers depends on the number of personnel, their income levels, industry, and choice of feature options.

  1. Employer groups with more lives are less expensive to cover. Carriers prefer to pool risks and larger groups allow greater diversity.
  2. The employer industry also determines the risk rating for group master contracts. Those in high-risk industries pay more.
  3. The employer group demographics play a big role in the overall rate. A group that skews to older age ranges will pay more.
  4. The employer choice of group feature options also affects pricing.
    1. Plans with shorter elimination periods cost more
    2. Policies with longer benefit periods charge more
    3. Plans with higher monthly benefits are more expensive