Practice Quiz

Health and Life Insurance

Category - Disability

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What is the purpose of the future increase option?
  1. To allow the insured to have more income during disability
  2. To allow the insured to increase options on the disability coverage package
  3. To allow the insured to purchase additional disability income protection
  4. To allow the insured to reduce premiums over a longer term
Explanation
Answer: C - The purpose of the future increase option is to allow the insured to purchase additional disability income protection. A future increase option can be added regardless of insurability at specified times and the rate is determined by the age of the individual at the time of purchase and not the original age at issue. Further limitations include only being able to purchase specified predetermined amounts, limitations based on the income level/additional coverage ratios, and the number of option dates.
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