Chapter 10: Riders Flashcards
(40 cards)
If the insured becomes disabled, the ____ of ____ rider waives premiums after the insured has been disabled for the requisite waiting period, which is usually 3 or 6 months.
Waiver of Premium
TF: For Waiver of Premium riders, any premiums paid during the elimination period will be refunded. Insurers typically require that the disability be total and permanent.
True
The waiver of premium rider usually falls off at age ____ or ___
60 or 65
TF: In order to qualify for the waiver of premium, the insured must be under a physician’s care and be certified as disabled by that physician.
True
The ____ _____ ______ rider offered by disability income insurers provides up to one year of disability income coverage, equal to what Social Security would pay, but before Social Security benefits have begun. The AMB usually begins during the Social Security disability waiting period.
Additional Monthly Benefit (AMB)
Disability income insurers sometimes offer a ___ ____ ____ rider, also referred to as a Social Security Rider, which is intended to supplement Workers’ Compensation benefits and other social insurance programs.
Social Insurance Supplement (SIS)
TF: The SIS pays a benefit equivalent to what Social Security disability would pay, but if Social Security actually begins to pay the insured, the SIS benefit is reduced by the amount of the Social Security benefit.
True
The ____ _____ ______ benefit rider pays benefits for the following scenarios:
During the 5-month Social Security disability income waiting period;
If the insured has been denied Social Security disability income benefits; or
If the amount of the Social Security disability income benefit is less than what the SIS rider would pay.
Social Insurance Supplement (SIS)
The ____ __ _____ ______ rider automatically increases the insured’s disability income benefits after the insured has been receiving benefits for at least 12 months.
This rider protects the insured from the decline of the dollar value caused by inflation.
Cost of Living Adjustment (COLA)
The _____ ______ or future increase option rider is similar to the provision found in life insurance. It allows the insured to buy additional disability income coverage without proving evidence of insurability.
guaranteed insurability
The _____ of ____ to ______ provision restricts the insured’s disability income benefit to an amount based on earned income during the previous two years.
Relation of Earnings to Insurance
The _____ _____ rider is an optional benefit that waives the elimination period if the insured requires inpatient hospitalization. The rider will pay the insured the total disability benefit while hospitalized during the policy’s elimination period, and ceases once the insured is released from the hospital.
Hospital Confinement
The ____ _____ provision prolongs the disability income policy benefit period beyond the age 65 cutoff to the insured’s entire life. The provision usually requires that the insured is totally disabled prior to age 65.
Lifetime Benefits
Policies that pay lifetime benefits for sickness usually require that the disability occur prior to the insured reaching the age of ____
55
___ ____ ____riders would provide a level face amount with an annually, increasing premium. These disability income policies are similar to term life insurance.
Annual Renewable Term (ART)
A disability income policy may include an ___ ___ and _____ rider that covers accidental injury. The rider functions just like a standalone ___ ___ and ____ policy, paying a principal sum for accidental death or loss of vision in both eyes, or loss of two or more limbs, and a capital sum for loss of one hand, one foot, or loss of vision in one eye.
AD&D
TF: The loss of use is not payable under AD&D. If the individual does not lose an entire hand, only the loss of the thumb and index finger on the same hand is payable under AD&D.
True
A _____ ______ provides coverage of job training services to a totally disabled insured, so the insured can resume working at their prior employment or begin a new occupation.
The difference between this and partial disability is this requires a period of total disability and usually provides a benefit for a specified time to transition back to work.
Rehabilitation Benefit
The _____ ______ benefit, also referred to as the nondisabling injury rider, pays medical expenses caused by an accidental injury that does not cause total disability. This benefit does not pay disability income benefits.
medical reimbursement
Two types of refund provisions for insureds who minimally utilize their disability income policy benefits?
Return of Premium
Cash Surrender Value
This type of rider refunds premiums in cases where premium payments far exceed claims paid. The insurer returns premiums after a designated number of years
Return of Premium
This type of rider refunds 60-80% of the insured’s premiums and interest in cases where premium payments far exceed claims paid. This benefit is only paid when the disability income policy is terminated.
Cash Surrender Value
_____ to disability income policies:
Military service
War
Specific aviation
Injuries while living overseas
Self-inflicted and intentional injuries
Attempted suicide
Injuries while committing a felony
Exclusions
An ____ _____ is added to disability income policies in which the insured has an existing medical condition. This rider excludes coverage for that particular condition.
Impairment Rider
