Disability Income

Which of these statements concerning an individual disability income policy are true

normally includes elimination period

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

recurrent disability

Which of the following is the MOST important factor when deciding how much disability income coverage an applicant should purchase

income

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?

residual disability

An insured owns an individual disability income policy with a 30 day elimination period for sickness and accidents and a monthly indemnity benefit of $500. If the insured is disabled for 3 1/2 months, what is the MAXIMUM amount he would receive for an approved claim

$1250 3 1/2 months minus 1 month wait. 2 1/2 month coverage. $500 x2 1/2

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

Disability policies do NOT normally pay for disability arising from with of the following

NO: WAR YES: accidents, negligence, sickness

What is the elimination period of an individual disability policy?

The time a disabled person must wait before benefits are paid

N is covered under an individual disability policy with a 30 day elimination period and a monthly benefit of $500. N is totally disabled for 3 1/2 months. N's total benefit received on this claim is

$1250 3 1/2 months minus 1 month wait. 2 1/2 month coverage. $500 x2 1/2

V is insured under an individual Disability Income policy with a 30-day Elimination period. On July 1, he is involved in an accident and temporarily disabled. He returns to work on December 1. How many months of benefit are payable?

4 months

A physician opens up a new practice and qualifies for $7,000/month disability income policy. What rider would the physician add if he wants the ability to increase his policy benefit as his practice and income grow

Guaranteed insurability option rider

J has a disability income policy that does not provide benefits for losses occurring as a result of his employment. What kind of coverage is this

non occupational coverage

Z owns a disability income policy with a 30 days elimination period. Z contracts pneumonia that leaves him unable to work from Jan 1 until Jan 15. Z then becomes disabled from an accident on Feb 1 and the disability lasts until July 1 the same year. Z will become eligible to receive benefits starting on

March 1

Which of the following actions may NOT be taken by an insurance company to insure a substandard applicant for disability income coverate

NO: lengthen the contestability period YES: increase the premium, do not cover the substandard condition, limit the type of coverage

An individual disability income insurance applicant may be required to submit all of the following except

NO: spouses income YES: medical history, gross income, occupation

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

disability income

In the event of an illness a(n) ___ ___ policy would reimburse an insured for loss of earnings

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

disability income

M becomes disabled and is unable to work for 6 months. M dies soon after from complications arising from this disability. M has a disability income policy that pays $2000/month. Which of the following BEST describes what is owed to the estate

earned but unpaid beneftis

In a disability income policy, which of these clauses acts as a deductible

elimination period

Non occupational disability coverage is designed for

employees who suffer non work related disabilities, since work related disabilities are covered by worker's comp

With disability income insurance, an insurance company may limit the monthly benefit amount a prospective policy holder may obtain because of the insured's

gross income at the time of purchase

Bryce purchased a disability income poicy 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

When determining the monthly benefit amount for a disaibiiity income policy, the factor that limits the amount a prospective insured may purchase is

income

T has Disability Income policy that pays a monthly benefit of $5000. If T becomes partially disabled, what can he likely expect?

less than $5000 per month benefit regardless of the cause

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?

recurrent disability

X owns a Disability Income policy. X recently suffered a disability which was due to the same cause as a previous disability. These disabilities both occurred over a four-month span. Which of the following provisions allows X's second disability to be covered without a new elimination period?

recurrent disability

D is an architect receiving disability income benefits who is not able to return to work full time, but can work part time. Which of these features would allow D to continue receiving benefits

residual benefit clause; based on the proportion of income actually lost due to the partial disability and takes into account ability to work some

R had received full disability income benefits for 6 months. When he returns to work, he is only able to resume half his normal daily workload. Which provision pays reduced benefits to R while he is not working at full capacity

residual disability

What does a guaranteed insurability rider provide a disability income policyowner

the ability to periodically increase the amount of coverage without evidence of insurability

T was insured under an individual Disability Income policy and was severely burned in a fire. As a result, T became totally disabled. The insurer began making monthly benefit payments, but later discovered that the fire was set by T in what was described as arson. What actions will the insurer take?

the insurer will rescind the policy, deny the claim, and recover all payments made

A disability elimination period is best described as a

time deductible

R becomes disabled and owns an individual disability income policy. When is R elibible to receive disability benefits

upon satisfying the elimination period requirement

What is the primary factor that determines the benefits paid under a disability income policy

wages

The provision in a health insurance policy that suspends premiums being paid to the insurer while the insured is disabled is called

waiver of premium