Individual disability income benefits are usually limited to roughly 60 to 70% of earned income so that:

a.The insurer can earn a larger profit
b.The insured retains a financial incentive to return to work, avoiding overinsurance
c.The premium can be set higher
d.The disability benefits would automatically become fully taxable to the insured once they exceed half of prior income

Explicación

Capping benefits below full income prevents overinsurance and keeps a return-to-work incentive, since being disabled should not pay better than working. It is not about insurer profit, premium level, or taxation.

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Revisado por John Zihao Zhang — California-Licensed Life Insurance Agent (CA Dept. of Insurance License #4396095 — verificar)
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