Ch 14: Disability Income Flashcards
What’s disability income insurance?
Replaces a portion of the insured’s income if they become disabled
If an employ____ pays the premium (tax deductible), benefits are taxable.
Employer
If the employee pays the premium (not tax deductible) benefits are or are not taxable
Are not taxable
Tax treatment for individual disability income policies are
Non deductible premium and tax free benefits
What is Own occupation defined as?
Insured’s inability to perform any or all of the duties of his/her own occupation as a result of sickness or accident. Least restrictive, easier to satisfy.
What is any occupation defined as?
Insured’s inability to perform the duties of ANY occupation for which the insured is reasonably qualified.
Occupational policy covers what?
Covers disabilities suffered on and off the job
What is non occupation policy do?
Excludes coverage while working (usually issued to the person engaged in hazardous jobs)
What’s presumptive disability?
Total disability. Loss of use of any two limbs, total and complete blindness, and loss of speech and hearing.
What’s partial disability?
Defined as the insured’s inability to perform one or more important duties of his/her own occupation of the the inability of the insured to work on a full time basis.
What’s residual disability?
An insured may be able to return to work but due to disability he/she cannot earn as much as prior to suffering the disability.
To be classified as an accident under disability income policy. The criteria is..
The cause may be intentional but the result must be accidental
Accidental means more or less restrictive
More restrictive
Accidental results or accidental bodily injury provision means is more or least restrictive?
Least restrictive
The shorter the elimination period (waiting period) the ____ the premium
Higher the premium
