Disability insurance proceeds are taxable:
- A) if the employee pays for the disability insurance
- B) Never
- C) Always
- D) If the employer pays for the disability insurance
Answer: D) If the employer pays for the disability insurance
What is credit disability insurance?
- A) Disability insurance on a debtor
- B) Life insurance on the life of a creditor
- C) Disability insurance that is paid for with a credit card
- D) Homeowners insurance for a mortgagee
Answer: Disability insurance on a debtor
Which of the following statements is true regarding disability income insurance?
- A) The purchase of disability income insurance is not necessary if you are covered under workers compensation.
- B) Increasing the elimination period reduces the premium for disability income insurance.
- C) Disability income insurance usually replaces 100 percent of lost income.
- D) A uniform definition of disability appears in all disability income policies.
Answer: B) Increasing the elimination period reduces the premium for disability income insurance.
An insured’s disability insurance plan has a recurrent disability provision for six months. If the insured is disabled, this plan will:
- a. Not pay for more than one disability in a period of six months
- b. Waive the elimination period for a disability claim made within six months of a previous claim
- c. Waive the elimination period for a disability claim made more than six months after a previous claim
- d. Waive the elimination period for any disability claim occurring in the first six months of the policy period
Answer: b. Waive the elimination period for a disability claim made within six months of a previous claim.
Disability insurance contracts often include a provision called an “elimination period”. Which of the following best describes this time period:
- A. A number of days a person joining a group has to wait before becoming eligible for insurance coverage.
- B. A period of time which applies equally to both accident and sickness.
- C. A period during which benefits will be paid if a disability continues.
- D. A specific number of days or months after the onset of a disability that must pass before any payment of benefits begin to be paid to the insured.
Answer: D.A specific number of days or months after the onset of a disability that must pass before any payment of benefits begin to be paid to the insured.
Which of the following statements regarding an accidental death and dismemberment rider for a disability insurance policy is NOT correct?
- A) The dismemberment feature provides insureds with periodic payments to help them during a rehabilitation period.
- B) The life insurance feature of this rider does not pay a death benefit if the death is due to natural causes.
- C) The sum payable under the dismemberment feature is typically expressed as a muliple of the disability policy’s weekly indemnity.
- D) Once a sum has been paid under the dismemberment feature, the disability income payments stop.
Answer: A) The dismemberment feature provides insureds with periodic payments to help them during a rehabilitation period.
Which of the following is a description of a Life and Disability Analyst ?
- A. A broker paid fees for service
- B. A person licensed to assist an agent in soliciting life insurance
- C. A person licensed to advise clients about life and disability insurance for a fee
- D. Any agent
Answer: C. A person licensed to advise clients about life and disability insurance for a fee.
Which of the following statements about group disability insurance is CORRECT?
a. Short term disability benefits must be paid at least monthly.
b. Short term benefits are paid for up to two years, after which long term benefits must be paid.
c. The definition of disability changes from “your own occupation” to “any occupation” after two years of disability.
d. Long term disability benefits must be paid at least quarterly.
Answer: C. The definition of disability changes from “your own occupation” to “any occupation” after two years of disability.
Which of the following losses would be covered by Disability insurance?
- a. A disability suffered by a fall on the job
- b. Residual Disability
- c. A disability suffered while making a delivery in the employer’s truck
- d. Long-term care
Answer: B. Residual Disability