Florida 2-20 General Lines Agent (Property, Casualty, Commercial Lines and Florida Law)Health InsuranceMedium
A Florida resident is reviewing their individual disability income policy. The policy states that benefits will be paid for a maximum of 24 months for any single disability. This provision refers to the policy's:
- ARecurrent disability clause
- BElimination period
- CBenefit amount
- DBenefit period
Show answer & explanationAnswer & explanation
Correct answer: D. Benefit period
The benefit period in a disability income policy specifies the maximum length of time for which benefits will be paid after the elimination period has been satisfied.
Why the other options are wrong
- A. A recurrent disability clause addresses how a disability that returns after a period of recovery is treated, not the maximum length of benefits for a single disability.
- B. The elimination period is the waiting period before benefits begin, not the maximum duration of payments.
- C. The benefit amount is the dollar amount of the monthly payment, not the duration.
Disability Income Benefit Period
The maximum length of time for which disability income benefits will be paid under a policy, once the elimination period has been satisfied.
- Can range from a few months to 'to age 65' or 'lifetime'.
- Longer benefit periods typically mean higher premiums.
- Benefits stop once the insured recovers or the benefit period ends.
Memory trick: Benefit Period: How long the money flows.