PSI Ohio Insurance Practice Exam

In disability income policies, which provision guarantees benefits if an individual suffers total loss of two limbs, blindness, or speech?

1. Waiver of premium

2. Presumptive disability

3. Residual disability

4. Categorical disability

The correct answer is: Presumptive disability

The provision that guarantees benefits for individuals who have suffered a total loss of two limbs, blindness, or speech is known as presumptive disability. This provision recognizes that these specific losses are so significant that an individual can be deemed permanently and totally disabled without having to undergo the usual evaluation process required for disability claims. Presumptive disability is designed to provide immediate financial support to individuals facing these severe disabilities, ensuring they receive benefits without needing to demonstrate ongoing inability to work due to their condition. This provision acknowledges the profound impact that such disabilities have on a person's ability to engage in daily activities and gainful employment. In contrast, the other options address different aspects of disability policies. For instance, waiver of premium refers to the provision that allows the policyholder to avoid paying premiums while receiving disability benefits. Residual disability deals with situations where the insured is partially disabled; that is, they can still work but at a reduced capacity. Categorical disability is not commonly recognized as a specific term in insurance policies related to disability income coverage, which may lead to confusion.