Disability Income Insurance Ch. 4

A CEO's personal assistant suffered injuries at home and as a result, was unable to work for four months. Which type of policy will pay a monthly benefit to the personal assistant? Disability Income Major Medical Key Employee Business Overhead Expense

Disability Income

B is a teacher who was injured in a car accident and cannot work. She is now receiving monthly benefits as a result of this accident. Which type of policy does B have? Major Medical Blanket Disability Income Indemnity

Disability Income

K becomes ill after traveling overseas and is unable to work for 3 months. What kind of policy would cover her loss of income? Indemnity Major Medical Travel Disability Income

Disability Income

T has Disability Income policy that pays a monthly benefit of $5000. If T becomes partially disabled, what can he likely expect? $5,000 per month benefit $10,000 per month benefit if the cause was accidental More than $5,000 per month benefit if cause was work-related Less than $5,000 per month benefit regardless of the cause

Less than $5,000 per month benefit regardless of the cause

Which of these statements concerning an individual Disability Income policy is TRUE? Premiums are normally tax-deductible Age of the insured determines the amount of the benefits Normally includes an Elimination period Benefits are normally taxable

Normally includes an Elimination period

When an insured has the same disability within a specified time period and the insurance company provides the same benefits without a new waiting period, the second disability is covered under which of the following benefits? Residual Disability Presumptive Disability Recurrent Disability Partial Disability

Recurrent Disability

P received Disability income benefits for 3 months then returns to work. She is able to work one month before her condition returns, leaving her disabled once again. What would the insurance company most likely regard this second period of disability as? A presumptive disability An occupational disability A residual disability A recurrent disability

A recurrent disability

M becomes disabled and is unable to work for six months. M dies soon after from complications arising from this disability. M has a Disability Income policy that pays $2,000 a month. Which of the following statements BEST describes what is owed to her estate? $2,000 A lump sum of six times the monthly benefit Nothing Earned, but unpaid benefits

Earned, but unpaid benefits

In a Disability Income policy, which of these clauses acts as a deductible? Elimination Period Waiver Period Deductible Period Probationary Period

Elimination Period

Bryce purchased a disability income policy with a rider that guarantees him the option of purchasing additional amounts of coverage at predetermined times without requiring to provide evidence of insurability. What kind of rider is this? Guaranteed insurability rider Additional coverage rider Paid-up option rider Extended insurability rider

Guaranteed insurability rider

D is an architect receiving Disability Income benefits who is not able to return to work full time, but can work on a part-time basis. Which of these features would allow D to continue receiving benefits? Residual Benefit clause Waiver Benefit clause Concurrent Benefit clause Guaranteed Benefit clause

Residual Benefit clause

When a person returns to work after a period of total disability but cannot earn as much as he or she did before the disability, this situation is called which of the following? Waiver of premium Recurring disability Residual disability Presumptive disability

Residual disability

What is the primary factor that determines the benefits paid under a disability income policy? Education level Wages Type of occupation Age

Wages

Disability policies do NOT normally pay for disabilities arising from which of the following? Accidents War Negligence Sickness

War

When determining the monthly benefit amount for a Disability Income policy, the factor that limits the amount a prospective insured may purchase is occupation income age medical condition

income

An individual Disability Income insurance applicant may be required to submit all of the following information EXCEPT medical history gross income occupation spouse's occupation

spouse's occupation