Which of the following is NOT an example of a limited-benefit policy?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
A comprehensive long-term disability income policy is designed to replace a substantial portion of the insured's earned income during long periods of total or residual disability and is not a limited-benefit product. Credit disability, hospital confinement indemnity, and specified disease policies are all classic limited-benefit products: they pay fixed, contract-stated amounts for narrow events rather than replacing lost income or reimbursing broad medical expenses. Distinguishing comprehensive from limited coverage is a core classification skill in accident and health insurance.
Why the other options are wrong
- B) Credit disability pays the debtor's loan payments for a stated period, a limited-benefit product.
- C) Hospital confinement indemnity pays a fixed daily amount while hospitalized, a limited-benefit product.
- D) Specified disease pays benefits only for named diseases, a limited-benefit product.
Memory hook
Comprehensive LTD replaces income broadly. Limited plans pay fixed checks for narrow events. Not the same league.