When you apply for an individual disability insurance policy, the premium is based on your actual age (as opposed to life insurance that ages you on your 1/2 birthday).
What happens if you apply for a policy close to your birthday?
If you apply for coverage and it is approved within 60 days (depending on the company) of your birthday, you can request to “save age.” This means that the policy will be dated the day before your birthday to lock in your age. Premiums will be due as of this date.
How do you determine if it makes sense to save age? It comes down to the premium. If you save your age, you are required to pay premiums as of that date. If your policy is approved three months after your birthday, you will need to back pay those three months to lock in your age. You need to determine if this extra premium payment is worth the savings of the rate change on your birthday.
Have your broker calculate the difference in cost to determine if it is worthwhile to save your age.