DC DC Disability and Long-Term Care Insurance 1

Question 1

Individual disability income insurance sold in DC is designed primarily to:

Accepted Answer

Replace a portion of the insured's earned income if they become unable to work due to disability

Answer

Disability income insurance replaces a percentage of lost wages—typically 60–70% of pre-disability income—when the insured cannot work.

Question 2

In DC, a disability income policy that uses an 'own-occupation' definition of disability means benefits are paid when the insured:

Accepted Answer

Cannot perform the material duties of their specific occupation

Answer

The own-occupation definition provides the broadest disability protection, paying benefits if the insured cannot perform their specific occupation even if they could work in another field.

Question 3

The 'elimination period' in a DC disability income policy functions similarly to:

Accepted Answer

A waiting period before benefits begin, similar to a deductible

Answer

The elimination period is a waiting period at the start of a disability during which no benefits are paid; the insured must be disabled for this period before benefits begin.

Question 4

Under DC insurance regulations, long-term care (LTC) insurance policies must include which consumer protection feature?

Accepted Answer

A nonforfeiture benefit option in case the insured stops paying premiums

Answer

DC and NAIC model regulations require LTC insurers to offer a nonforfeiture benefit, such as shortened benefit period coverage, if a policyholder lapses after paying premiums for years.

Question 5

A DC long-term care insurance policy that covers care in a nursing facility, assisted living facility, and at home is best described as:

Accepted Answer

A comprehensive (integrated) LTC policy

Answer

A comprehensive LTC policy covers multiple settings of care including nursing facilities, assisted living, and home health care, giving the insured maximum flexibility.

DC - District of Columbia Insurance Practice Test

DC - District of Columbia Insurance Practice Test

DC DC Disability and Long-Term Care Insurance 1