Chapter 5: Key Terms Flashcards
Any Occupation
Type of disability insurance policy that provides benefits to a policyowner if they are unable to perform the duties of any occupation for which they are suited by education, training, or experience.
Automatic Increase Rider
A provision that automatically increases the monthly benefit by a stated percentage each year.
COLA Rider
Provides a cost of living adjustment to benefit payments based on increases in inflation.
Disability Insurance
A type of insurance that provides supplementary income in the event of an illness or accident resulting in a disability that prevents the insured from working at their regular employment.
Elimination Period
The period of time, beginning upon injury or sickness, that an insured is disabled but is not collecting benefits from the insurer.
Future Increase Option Rider
A provision that permits the insured to increase benefit coverage as they get older
Guaranteed Renewable
A provision that requires the insurance company to renew the policy for a specified period of time or until the insured attains a certain age
Long-Term Disability
Provides coverage for specified term, until specified age, or until death
Non-Cancelable
A provision that prevents the insurance company from canceling the policy for any reason provided the policy premium is paid
Own Occupation
Type of disability insurance policy that provides benefits to a policyholder if they are unable to perform the duties of their occupation. This type of policy is more expensive than an any occupation policy
Partial Disability
A provision that provides payments that are less than those paid for a total disability
Presumptive Total Disability Coverage
A provision that automatically considers certain conditions to be totally disabling, such as loss of sight in both eyes, hearing in both ears, the use of both hands, the use of both feet, or the use of one foot and one hand
Residual Benefits Provision
A provision that provide continuing benefits for an insured who returns to work but suffers a reduction of income due to a disability
Short-Term Disability
Provides coverage for up to two years, and typically has a 5 to 30 day elimination period (the period an insured must wait before receiving benefits).
Social Security Disability Benefits
Available to anyone insured under the system who meets the strict definition of disability
