Disability Income and Related Insurance

When an insurer combines two periods of disability into one, the insured must have suffered a A Recurrent disability. B Partial disability. C Residual disability. D Presumptive disability.

A

Under a disability income policy, the insurer does not pay a monthly benefit that is equal to the insured's previous income. The reason for paying a benefit amount that is less than the insured's income is to A Enable the insurer to reduce variable costs. B Prevent overutilization and malingering. C Prevent the insured from obtaining excess insurance. D Enable the insurer to provide affordable coverage.

B

ll of the following benefits are available under Social Security EXCEPT A Death benefits. B Welfare benefits. C Old-age and retirement benefits. D Disability benefits.

B

A small business owner is the insured under a disability policy that funds a buy-sell agreement. If the owner dies or becomes disabled, the policy would provide which of the following? A The business manager's salary B Disability insurance for the owner C Cash to the owner's business partner to accomplish a buyout D The rent money for the building

C

All of the following are requirements of eligibility for Social Security disability income benefits EXCEPT A Fully insured status. B Waiting period of 5 months. C Being age 65. D Inability to perform any gainful work.

C

In which of the following cases would an "any occupation" disability income policy pay the benefits? A The insured is unable to perform the duties of his or her specific occupation. B The insured changes jobs and is injured as a result of a more hazardous occupation. C The insured's family has unexpected expenses due to the insured's disability. D The insured is unable to perform any jobs in the field related to the insured's education and experience.

D

An insured is involved in a car accident. In addition to general, less serious injuries, he permanently loses the use of his leg and is rendered completely blind. The blindness improves a month later. To what extent will he receive Presumptive Disability benefits? A No benefits B Full benefits C Partial benefits D Full benefits until the blindness lifts

A

Which of the following are the main factors taken into account when calculating residual disability benefits? A Present earnings and standard cost of living B Present earnings and earnings prior to disability C Earnings prior to disability and the length of disability D Employee's full-time status and length of disability

B

Which of the following conditions would a disability income policy most likely NOT require in order to qualify for benefits? A The insured must provide proof of disability B A specified income status prior to the disability C The insured must be under a physician's care D The insured must be confined to the house

B

Which of the following is NOT a characteristic of a group long-term disability plan? A The benefit period may be to age 65. B The benefit can be up to 66 and 2/3% of one's monthly income. C The benefit can be up to 50% of one's yearly income. D The elimination period is the same as in the short-term plan's benefit period.

C

Which statement accurately describes group disability income insurance? A There are no participation requirements for employees. B Short-term plans provide benefits for up to 1 year. C The extent of benefits is determined by the insured's income. D In long-term plans, monthly benefits are limited to 75% of the insured's income.

C

All of the following are true regarding key person disability income insurance EXCEPT A The employer receives the benefits if the key person is disabled. B The employer pays the premiums. C The employee is the insured. D Premiums are tax deductible as a business expense.

D

Disability income policies can provide coverage for a loss of income when returning to work only part-time after recovering from total disability. What is the benefit that is based on the insured's loss of earnings after recovery from a disability? A Recurrent disability B Partial disability C Income replacement D Residual disability

D

In a disability policy, the elimination (or waiting) period refers to the period between A The effective date of the policy and the date the first premium is due. B Coverage under a disability policy and coverage under Social Security. C During which any specific illness or accident is excluded from coverage. D The first day of disability and the day the insured starts receiving benefits.

D

In disability income insurance, if an insured is considered disabled if they cannot perform any job they are suited for by prior education, training or experience, they fall under which definition of total disability? A Typical B Statutory C Own occupation D Any occupation

D