Disability & Long-Term CareQuestion 87 of 716
An insured returns to part-time work after a covered disability and earns 40 percent of pre-disability income. Which provision pays a pro-rata benefit based on the lost income?
a.Residual disability
b.Presumptive disability
c.Recurrent disability
d.Partial disability with a flat 50 percent benefit
Explanation
Residual disability is the modern provision that pays a pro-rata benefit calculated on the percentage of income the insured has lost compared with pre-disability earnings. It encourages a return to part-time work without forfeiting the entire benefit.
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Related questions on this topic
- Why do disability income insurers cap the monthly benefit at roughly 60 to 70 percent of the insured's gross income?
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PrepPass team · Verified against California Life & Health Insurance License Exam · How we review
Reviewed by John Zihao Zhang — California-Licensed Life Insurance Agent (CA Dept. of Insurance License #4396095 — verify)