Which of the following statements is true of disability insurance?

Question

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The principle of indemnification in insurance means that the insured cannot profit or gain financially from a loss. Therefore, the amount of coverage for disability insurance will be limited to the actual loss suffered by the insured. Option A is incorrect because disability insurance is primarily meant to replace lost income due to disability, and someone who is retired and living on a pension may not have any income to replace. Option C is incorrect because self-employed individuals may not have access to government benefits like EI and Workers Compensation, and may need disability insurance to cover lost income in case of disability. Option D is also incorrect because CPP, EI, and Workers Compensation may provide some coverage in case of disability, but may not be sufficient for all individuals and situations.

Which of the Following Statements Is True of Disability Insurance