Chapter 5 Cont 4

Question 1

Wait period often with probationary/waiting period from policy issue date during which benefits will not be paid for illness related disabilities

Answer 1

10 to 30 days

Question 2

Purpose of probationary period is to reduces chances of

Answer 2

Adverse selection against insurer

Question 3

Adverse selection against insurer and helps insurer guard against individuals who would purchase disability income policy shortly after enveloping a disease or other condition that warrants immediate attention

Answer 3

Probationary period

Question 4

Length of time over which monthly disability benefit payments will last for each disability after the elimination period has been satisfied

Injury
Sickness
Presumptive disability
Benefit period

Answer 4

Benefit period

Question 5

Most polices offer 1, 2, 5, and to age 65 some offer Kim time benefits …longer benefit period the higher the

Injury
Sickness
Presumptive disability
Benefit limitations

Answer 5

Premiums will be

Question 6

Provision that is found in most disability income polices which specifies the conditions that will automatically qualify the insured for

Full disability benefits
Sickness
Injury
Benefit period

Answer 6

Full disability benefits

Question 7

Amount of monthly benefit payable under most disability income polices is based on a percentage of

Insureds past earnings
Compensation
Social insurance supplement
Sickness

Answer 7

Insureds past earnings

Question 8

Primary purpose of disability income ins is to

Reimburse lost income while in the hospital

Reimburse loss of income to a family due to death of insured

Replace income lost due to disability

Answer 8

Replace income lost due to disability

Question 9

Insured covered by a disability income policy that contains accidental means clause. The insured exits a bus by hyping down the steps and breaks an ankle …what coverage will apply

Coverage will apply since break was accidental

Coverage will apply but will be reduced by 505

No coverage will apply since injur could have been foreseen

Answer 9

No coverage will apply since injury could have been foreseen

Question 10

In comparison to a policy that uses the accidental means definition a policy that uses accidental bodily injury definition would provide a coverage that is

Broader in general
More limited in general
More limited in duration
Broader in duration

Answer 10

Broader in general

Question 11

Policy that uses accidental bodily injury will provide

Answer 11

Broader coverage than policy using accidental means

Question 12

Bethany studies in England for semester while she is there she is involved in train accident that leaves her disabled. If Bethany owns a general disability policy what will be the extent of benefits that she receives

Full
50%
255
None

Answer 12

None

General disability policies dont cover war military service intentionally self inflicted overseas or suffered whil attempting felony

Question 13

In a disability income policy all of the following are considered presumptive disabilities except

Loss of speech
Loss of one eye
Loss of hearing
Loss of two limbs

Answer 13

Loss of one eye

Question 14

Provision found in most disability income polices which specifies the conditions that will automatically qualify insured for full didsability benefit

Answer 14

Presumptive disability

Question 15

A mouthy of monthly benefits payable under most disability income policies based on percentage of insureds past earnings

Compensation
Benefit limitations
Overhead expense

Answer 15

Benefit limitations

Question 16

Insured is involved in accident that renders him permanently deaf although he does not sustain any other major injuries. Insured is still able to perform his current job. What extent will he rec presumptive disability benefits

Full benefits
Partial benefits
Full benefits for 2 years
No benefits

Answer 16

Full benefits

Question 17

These policies typically require the loss of at least two limbs total and permanent blindness or loss of speech or hearing

Answer 17

Presumptive disability

Question 18

Insurers usually dont reimburse claimants for 100% of income lost due to disability. What is reason for limitations on coverage amounts

To provide incentive for insured to return to work
To make sure there is enough money to reimburse all claims
To reimburse only for premiums paid into policy

Answer 18

To provide an incentive for insured to return to work

Question 19

In disability policy the probationary period refers to the time

Between first day of disability and the actual receipt of payment for disability incurred
During which illness related disabilities are excluded from coverage
Between the firs day of disability and the day disability must continue before insured receives any benefits

Answer 19

During which illness related disabilities are excluded from coverage

Question 20

Client has new disability individual income policy with 20 day probationary period and 30 day elimination period. Ten days later client breaks leg and is off for 45 days. How many days of disability Benita will policy pay

Answer 20

15 days

Question 21

Period of time immediately following disability during which benefits are not payable

Elimination period
Probationary period
Grace period
Back out period

Answer 21

Elimination period

Question 22

Social security supplement or social security riders would provide for the payment of income befits in each of the situations below except

When insured is eligible for social security benefits but before the benefits begin
If insured has been denied coverage under social security
When the amount payable under social security is more than the amount payable under the rider

Answer 22

When the amount payable under social security is more than the amount payable under the rider

Question 23

These riders provide benefits when the amount payable under social security is less than the amount payable under the rider

Answer 23

SSI social security supplement aka social security riders

Question 24

The shorter the waiting period, the higher the

Answer 24

Premium

Question 25

After the insured satisfies the waiting period they will receive benefits from the insurer for a limited

Answer 25

Benefit period

Question 26

Which of the following disability income policies would have the highest premium

15 day waiting period/5 year benefit period
15 day waiting period/10 year benefit period
30 day waiting period/10 year benefit period
30 day waiting period/5 year benefit period

Answer 26

15 day waiting period 10 year benefit period