When Should You Drop Your Disability Insurance?

Along with life insurance, disability insurance is one of the most important types of coverage the average person can have. With this type of insurance, you can protect your income even if you become disabled and are no longer able to work. While this type of insurance can be beneficial, you may wish to drop it at some point in the future to save money on the premiums.

Change in Working Status

In many cases, disability insurance is purchased by the primary breadwinner in the family. For example, if the husband has a high-paying job and the wife stays at home, the disability insurance would need to be purchased for the husband. If the husband stops working and the wife goes to work to be the primary breadwinner, it would not make much sense to have disability insurance on the husband any longer. At that point, you could stop buying disability insurance coverage for the husband.

Change in Dependents

One of the primary reasons that people buy disability insurance is so that they will have enough money to support their beneficiaries if they become disabled. If you no longer have any dependents that are counting on you for sustenance, you may not need to pay for disability insurance premiums any longer. For example, if your spouse passes away or your kids grow up and start supporting themselves, you may not need this coverage.


Another time that you can consider changing your disability insurance coverage is when you reach retirement age. If you have saved diligently or if you are covered by a pension plan, you may have enough money coming to you from a retirement plan once you reach the proper age. At that point, the money will keep coming regardless of whether you are able to continue working. You could then stop paying your disability insurance premium since you are no longer required to work.

No Longer Need to Work

If you have been very successful in life and you no longer need to depend on your work to provide income, you could also stop the disability insurance coverage. For example, if you won the lottery or received a large inheritance that is big enough to support you and your family, it does not make much sense to buy disability coverage. While you can keep working, you do not have to depend on your ability to work to provide income.