Which of the following statements about disability and disability income insurance is (are)true?
I.Most disability income policies replace 100 percent of gross earnings.
II.The probability of being disabled before age 65 is much higher than commonly believed.

Question

Quizplus · Accepted Answer

While statement I is not true, statement II is true. Studies have shown that the probability of a working person becoming disabled before age 65 is much higher than the probability of death before age 65. It is recommended to have disability income insurance to mitigate the financial impact of a disability. However, disability income policies typically do not replace 100 percent of gross earnings, usually replacing a percentage (e.g. 60 percent) of pre-disability income.

Which of the Following Statements About Disability and Disability Income