Ch. 4 health Flashcards
Any occupation
to qualify for disability benefits, the insured must be unable to perform any job for which they are reasonably suited by education, experience, or training, not just their previous job or occupation
Own occupation
to qualify for disability benefits, the insured must be unable to perform the specific duties of their own job or occupation that they were engaged in at the time of the disability
Presumptive disability
a disability income policy benefit that provides that if an insured experiences a specified disability, such as blindness, the insured is presumed to be totally disabled and entitled to the full amount payable under policy, whether or not the insured is able to work. Presumptive disabilities include total blindness, total deafness, loss of speech, and loss of two or more limbs
Residual amount benefit
provides partial disability benefits to individuals who are unable to perform their full job duties due to a disability but can still work part-time or in a reduced capacity
The amount of the residual benefit is typically calculated based on the difference between the insured’s pre-disability earnings and their current earnings while disabled. The insurance pays a percentage of the difference between the two, up to the policy’s benefit limit
Probationary period
a specified number of days after an insurance policy’s issue date during which coverage is not afforded for sickness. Standard practice for group coverage as well as disability coverage. The probationary period typically does NOT apply to accidents. The real goal of this provision is to prohibit people from buying insurance only when they need it and immediately filling a claim
Elimination period
the time you must wait after becoming disabled before you can start receiving benefits from your insurance policy
Benefit period
the maximum length of time during which a benefit is paid. The longer the benefit period, the higher the cost (premium) of the policy. Instead of charging additional premiums or excluding coverage when issuing a disability income policy to a substandard risk, an insurer may shorten the benefit period
Delayed disability provision
allows for benefits to be paid if a disability, which is later diagnosed, is found to have been present and disabling from a prior date, even if symptoms or diagnosis occurred after a delay
Recurrent disability provision
a disability income policy provision that specifies the period of time during which the reoccurrence of a disability is considered a continuation of a prior disability
Social security rider
supplements disability insurance benefits by providing additional financial support based on the insured’s eligibility for Social Security Disability Insurance
Cost of living adjustment rider
a rider available with some policies that provides for an automatic increase in benefits (typically tied to the Consumer Price Index), offsetting the effects of inflation
Guaranteed insurability rider
additional insurance may be purchased at various times without evidence of insurability. This rider guarantees the insureds insurability giving them the right to purchase additional amounts of disability income coverage at predetermined times in the future without proof of good health
Nonoccupational coverage
insurance protection for injuries or illnesses that occur outside of work-related activities
Partial disability
an Illness or injury preventing insured from performing at least one or more, but not all, of the insured’s occupational duties or the inability to work at that job on a full-time basis
Accidental means policy
the unforeseen, unexpected, unintended cause of an accident. The cause of the mishap must be accidental for any accident-based policy claim to be payable
Accidental results policy
policies that use the accidental bodily injury provision (sometimes called the results provision) required that the result of the injury has to be unexpected and accidental. This is far less restrictive than the accidental means provision
Rehabilitation benefit
facilitates vocational training to prepare insured for a new occupation. With some disabilities, insureds may not be able to return to their normal occupation but still be able to work at some kind of job. Under the rehabilitation benefit the insurer will pay the approved cost of a rehabilitation program to help the disabled return to work
The percent-of-earnings approach
a method used to determine the amount of disability benefits based on a percentage of the insured’s pre-disability earnings
if a policy covers 60% of pre-disability earnings, and the insured’s earnings were $5,000 per month, the monthly benefit would be $3,000
Flat amount approach
a method of determining benefits based on a fixed, predetermined amount rather than a percentage of earnings
a policy might provide a flat benefit of $2,000 per month, regardless of whether the insured’s pre-disability earnings were $3,000 or $6,000 per month
Change of occupation provision
allows the insurer to reduce the maximum benefit payable under the policy if the insured switches to a more hazardous occupation or to reduce the premium rate charged if the insured changes to a less hazardous occupation
Non-disabling injuries
injuries that may have resulted from an accident but are not necessarily disabling. Many disability policies include a provision for medical expense benefits that pay the actual cost of medical treatment for non-disabling injuries that result from an accident
Elective indemnity options
may be selected by the insured when applying for a disability policy. These are typically for short-term disability income policies and provide for an optional lump sum payment for certain named injuries
The waiver of premium rider
allows the policy owner to waive premium payments during a disability and keeps the policy in force
Hospital confinement rider
waives the elimination period while the insured is confined to a hospital
Lifetime extension rider
This rider extends the duration of coverage or benefits for certain conditions or for the entire policyholder’s lifetime, providing additional protection beyond the original policy limits
