Video transcript
Presented by Jack Howard, Seaworthy Insurance.
If you work in tech, the thing that decides whether your disability policy actually protects you is how the carrier counts your income. That's true for software engineers, data scientists, cloud engineers, product managers and designers, and pretty much every other role across the sector. Tech compensation runs base salary plus bonus plus equity. And those three pieces get treated very differently in underwriting. Miss that and you end up paying for a policy sized to a fraction of what you really earn. Over the next few minutes, I'll cover how carriers count RSUs and bonuses, what occupation class tech professionals get, and why it changes your price, whether your employer's group coverage is enough, and how mental health coverage works for tech, and what shifts if you're on the finance side.
I'm Jack with Seaworthy Insurance. We specialize in disability insurance for software engineers and other high-income tech professionals. Let's start with income.
Start with the simple parts. Base salary counts directly. Bonus and commission, they count too. And carriers generally average them over about 2 years. So one enormous year or one weak year doesn't distort the number. For a lot of engineers, that's already most of the picture.
Equity is where people get surprised. Carrier income guidelines define earned income as salary, wages, commission, and bonus. And none of the five major carriers name RSUs or equity as its own insurable category. What happens in practice is more useful than that sounds. When your RSUs vest, they land on your W-2 as wages, and income reported that way generally counts when it's documented and recurring. A steady vesting schedule that's been showing up on your tax returns for a couple of years is usually workable. A single large cliff vest gets weighed more carefully because the carrier is trying to size a benefit against income you can actually count on year after year.
What doesn't count matters just as much. Unvested RSUs don't count. Unexercised options don't count. The discount on your employee stock purchase plan does not count. And investment income, dividends and capital gains, is unearned income. So it sits outside this entirely. If you're holding a large unvested grant, that isn't something you can buy coverage against today. So the practical move is to bring about 2 years of tax returns along with your vesting and bonus records. That documentation is what turns your actual compensation into benefits.
Occupation class is the carrier's risk tier for your job, and it mostly drives your premium and which riders are available to you. Tech does really well here. Software engineers, developers, product managers, and data scientists are generally classed 6A, a top office class on the general white-collar scale, low-hazard cognitive work.
Two specifics worth knowing. MassMutual runs its own class scale. And a software engineer with a computer science degree or five or more years in the career can be written at 5A/5. That's the highest occupation class MassMutual assigns. Different scale, same result. You're at the top of it.
Class also varies by state. Principal doesn't offer 6A in California, and its top office classes in California and New York run 5A-Select instead. Your class isn't uniform nationwide. And that's part of why the same engineer gets meaningfully different offers from different carriers.
Almost every tech company offers group long-term disability, and it's better than having nothing at all. It's also built on your base salary, which brings us back to the problem we opened with. Group long-term disability typically covers base only. So the bonus and equity making up a large share of your compensation never enter the calculation. It caps the monthly benefit, often well under what a senior person in tech earns. When your employer pays the premium, the benefit's generally taxable. So the figure in the benefits portal isn't the figure you'd actually bank, and it stays behind when you leave, which matters in an industry where people change companies every few years.
An individual policy is owned by you, priced on you, sized against your total earned income rather than base alone, and it follows you from job to job. On taxes, premiums you pay yourself with after-tax dollars generally produce tax-free benefits. Tax situations do vary, so confirm yours with a tax professional.
Tech gets treated better than medicine on this one. Carriers group certain occupations as higher risk for mental health claims, anesthesiology, emergency medicine, pain management, CRNAs, general dentistry. Those occupations are typically pushed into a 24-month limit on mental health claims. Benefits stop after 2 years, even if you still can't work.
Tech isn't on that list. Full-benefit-period mental health coverage is available across all five major carriers for tech occupations, though the route there differs by carrier. With some, it's the default. With others, the 24-month cap is an optional discount you can decline, and with one, it comes through an endorsement you add. The caveat is your state. California is the weak spot, where several of those options either aren't sold or the cap is required regardless of class. If you're in California, ask about this specifically instead of assuming it's included.
On the finance side, the compensation problem has the same shape with different labels, base plus bonus, base plus commission, or carry. The bonus and commission piece counts and gets averaged the same way, and the documentation is the same. Roughly 2 years of returns plus the records behind your variable comp.
Occupation class tends to work in your favor, too. MassMutual banded a group of high-income finance roles up to 5A/5, including CFAs, hedge fund and venture roles, and stockbrokers, at incomes of $250,000 and above. So a well-paid finance professional lands in a favorable class. The group coverage gaps carry over as well, because group LTD is built on base salary in finance the same way it is in tech. And in a comp structure where bonus is most of the number, that's a wide gap.
Recap. For tech and finance professionals, the question is how much of your real income the policy actually covers. Base, bonus, and commission count, with bonus and commission averaged over roughly 2 years. Vested RSUs generally count as W-2 wages when documented and recurring, while unvested grants, unexercised options, and the ESPP discount don't. Tech classes well, generally 6A, and MassMutual will write a software engineer with a computer science degree or 5 years of experience at 5A/5. [Editor's note: class assignment and issuance are determined by the carrier at underwriting; 5A/5 is the class MassMutual's occupation guide makes available for qualifying software engineers, not a guarantee of issue.] Group coverage is built on base, capped, taxable when your employer pays for it, and it doesn't leave with you. Full-benefit-period mental health coverage is available to tech across the five major carriers, with California as the exception worth asking about.
If you want to see what your total compensation actually supports in coverage, that's what we do at Seaworthy Insurance. We're a disability insurance specialist for software engineers and high-income tech professionals. The full written guide is linked in the description. Thanks for watching.
How do carriers classify tech professionals?
Carriers generally put software engineers, developers, product managers, data scientists, and most office-based tech roles at the top of their white-collar scale. There is no shared name for that spot. Ameritas uses 6A, Principal runs a 6A+ tier above its own 6A, MassMutual's scale tops out at 5A/5, and Guardian grades non-medical work 6, 5, 4, and 3. Occupation class is the carrier's read on how hazardous a job is, and it drives both the premium and the maximum benefit you can buy.
The U.S. Bureau of Labor Statistics' Occupational Outlook Handbook describes the work as designing computer applications or programs. It is desk-based cognitive work, which is exactly why it earns a favorable class. Per the BLS Occupational Employment Statistics, software developers earned a median wage of $133,080 as of May 2024, and total compensation at large technology firms runs well above that once bonus and equity are added. High pay paired with a favorable class is what makes tech one of the few high-income groups that is both well paid and inexpensive to insure relative to the benefit.
Tech sales and a handful of other roles are classed favorably but not always at the top tier, so the class is worth confirming on every quote. Class is state-dependent too. Principal does not offer 6A in California, and its top office classes in California and New York run 5A-Select instead, so the same engineer can be classed differently depending on where the policy is written. Because classification sets the premium and, at some carriers, which definitions and riders are available, the duties you list on the application are what settle it.
How should a tech benefit be sized?
A tech professional's disability benefit should be sized to total earned income, base and bonus plus the vested equity you can document, not base salary alone. The most common and most expensive mistake a tech professional makes is assuming employer coverage is enough. Group long-term disability typically reaches base salary alone, with a capped monthly benefit that is taxable when the employer pays the premium and gone the day you change jobs. Our group vs. individual guide for tech workers walks through each of those limits. For someone whose pay is 40% or more bonus, commission, and equity, that leaves the majority of their compensation uninsured.
An individual policy can be sized to your full earned income. Carriers typically credit bonus and commission directly on a roughly two-year average, vested RSUs land on your W-2 and generally count when the vesting pattern is consistent, and unvested grants and unexercised options sit outside the calculation. The component-by-component treatment, including ESPP and one-time cliff vesting, lives in our RSU and equity compensation guide. The documentation is straightforward, generally about two years of tax returns plus pay statements and vesting records, and sizing this correctly for equity-heavy pay is where a specialist broker earns their place.
Why does own-occupation matter for computer-based work?
For a tech professional, the own-occupation definition is what protects specialized cognitive output. An any-occupation contract lets a carrier argue that if you can still use a computer, you are not disabled, collapsing the difference between basic computer use and architecting systems or writing production code. A true own-occupation definition measures disability against your actual role, so a condition that ends your ability to do high-level technical work pays a benefit even if you could do something simpler.
We confirm the definition is true own-occupation for the full benefit period on every tech placement. Carriers vary in how their own-occupation language is written, and the differences matter at claim time, so we set them side by side in our own-occupation by carrier comparison and walk through the five majors provision by provision in our guide to the best disability insurance for software engineers.
What are the most common disability risks for tech professionals?
Tech work looks low-risk from the outside, which is why it earns a favorable occupation class, but the conditions most likely to interrupt a tech career come from the nature of the work rather than the workplace. Four categories account for most of what we see, and each interacts with how a policy defines disability, so the contract language matters as much as the underlying risk.
Years of sustained keyboard and mouse use drive RSI, carpal tunnel, and tendinopathy in the hands and wrists, the same hands the hands-on technical work depends on.
Deadline pressure, on-call rotations, and equity-tied stress contribute to anxiety, depression, and burnout. Mental and nervous conditions account for roughly 43% of the exclusions across our placed book (2026 audit), more than any other category.
Concussion, stroke, multiple sclerosis, or the cognitive effects of treatment can impair the sustained focus and problem-solving that technical and analytical work requires.
Long sedentary hours at a screen produce cervical and lumbar conditions and progressive vision strain that compound over a career.
What mental-health coverage can tech professionals actually get?
Tech professionals can secure full-benefit-period mental-health coverage, the kind that pays for the full benefit period rather than stopping at 24 months, which is a real advantage tech holds over high-risk medical specialties. Burnout, anxiety, and depression rank among the likeliest reasons a tech professional would ever need to file a claim. Across our own placed book, mental and nervous conditions drive more exclusions than any other category, roughly 43% of them as of the 2026 audit, as our State of Disability Underwriting analysis details.
Most contracts cap mental and nervous claims at 24 months, but tech professionals are not in the occupation group required to take that limitation. Full-benefit-period coverage is available across the major carriers through different mechanisms. Guardian and Principal generally provide it by default, Ameritas and The Standard offer it to the favorable classes with the 24-month cap as an optional discount, and MassMutual can remove its cap by endorsement.
California carves out the most, and it carves out most of the field. Principal's full-coverage option is unavailable there, Guardian's no-cap default does not apply, MassMutual's endorsement is not sold in the state, and The Standard requires the 24-month cap on every California policy regardless of class. New York is the other state to raise, since Principal requires the cap there as well. If your policy will be written in either state, have the mental and nervous provision quoted for your own state rather than assuming the national answer holds.
The practical point is timing. Full-benefit-period mental-health coverage is available, not just theoretical, but only to an applicant who has no mental-health history on record yet. Applying before any treatment is documented is what keeps that coverage on the table.
Which carrier fits a tech professional?
Carrier fit for a tech professional usually turns on mental-health treatment, how variable and equity pay are counted, and price at the top occupation class, and none of the five major carriers Seaworthy places leads on all three at once. Each structures coverage differently. The table below summarizes where each one tends to fit.
| Carrier | Mental-Health Treatment | Premium Positioning | Best Fit |
|---|---|---|---|
 | Full benefit period by default (not CA or NY) | Competitive, mid-range | Often the most flexible underwriter of the five |
 | Full available, 24-mo optional discount (not CA) | Preferred Occupation Discount up to 20% | Often the price leader for office professions |
 | Extendable by endorsement (not CA) | Competitive | Bonus-averaging suits variable pay |
 | Full available for top classes | Competitive, mid-range | True own-occ in the base definition |
 | Full benefit period by default (not CA) | Above Big 5 average | Among the strongest mental-health terms, priced higher |
The carrier picture shifts by role, because the risk being insured is different even when the pay looks similar. We keep a dedicated page for each. Read disability insurance for software engineers and developers where repetitive strain and hands-on injury are live claim drivers, disability insurance for data scientists and machine learning engineers for advanced quantitative work and fast-rising AI-era pay, disability insurance for product managers where a judgment-based role is harder to pin down at claim time, and disability insurance for tech sales professionals where the benefit has to be sized to on-target earnings rather than base.
For the full side-by-side analysis at your specific role and compensation, start with a tech quote comparison, see what disability insurance costs for a tech worker, or read the provision-by-provision breakdown in our guide to the best disability insurance for software engineers.
Is group disability coverage enough?
Group disability coverage alone rarely replaces enough of a tech professional's income. Group long-term disability through an employer applies a percentage-of-income formula with a monthly benefit cap that, for a high earner, falls well below actual income replacement need. Group plans also typically exclude bonus, commission, and equity from the calculation, pay a taxable benefit when the employer funds the premium, and usually limit the own-occupation period before switching to an any-occupation test. The full breakdown lives in our group vs. individual guide.
Group coverage also stays behind when you leave, a second structural problem that lands hardest in tech. Careers are built on job changes, startups, and equity events, and group coverage ends the day you leave an employer. A startup may offer little or no disability coverage at all. An individual policy is yours, it travels across every move, and a future increase option lets the benefit grow with a fast-rising income through promotions, a new role, or a liquidity event, with no new medical underwriting.
When should a tech professional buy?
The best time for a tech professional to buy disability coverage is early, while young, healthy, and cleanly insurable. A generally favorable occupation class keeps coverage affordable from day one, and getting a policy in force before any mental-health treatment, repetitive-strain diagnosis, or other condition enters the record preserves the strongest terms. Adding a future increase option at purchase lets the benefit grow later as income climbs.
Underwriting is where the timing argument gets concrete. Across Seaworthy's placed book (2026 audit), about 28% of policies came back with an exclusion or a rating, and mental and nervous conditions were the most frequent reason, as detailed in our State of Disability Underwriting report. When an underwriter attaches a restriction that does not fit the medical record, we challenge it with supporting case history, and if the underwriter will not move, we re-shop the file to a carrier that reads the record differently. Applying healthy and early, before any history exists to underwrite against, is still the cleanest path.
How does Seaworthy place coverage for tech?
Tech has become a fast-growing part of our client base, and our approach to it is consistent. We are independent and carrier-neutral, and on every tech case we run all five major carriers, Guardian, Principal, MassMutual, Ameritas, and The Standard, comparing them on occupation class, own-occupation language, mental-health treatment, and price for your specific role and compensation.
The intake is consistent regardless of the carrier ultimately selected. We collect current and projected income, the structure of your pay, dependents, health history, and career plans, then present the contracts side by side so you can choose on terms rather than premium alone. The result is a policy sized to your real income and written to protect the technical work you actually do.