LLQP Accident & Sickness · Component 2.1 · 30% of the exam
Residual disability benefits are calculated on:
- The percentage of income lost compared with pre-disability earnings
- BA flat 50% of the total benefit for the first six months of reduced work
- CThe insured's age at the time the residual claim first begins
- DThe number of hours worked compared with the pre-disability schedule
Correct answer: A) The percentage of income lost compared with pre-disability earnings
Residual benefits are proportionate to loss of earnings. Most policies pay the full benefit if the loss exceeds a threshold (often 75–80%) and nothing below a minimum loss (often 20%).
Why the other options are wrong
- BA flat percentage is the partial disability approach.
- CAge does not determine the benefit.
- DHours may define partial disability, not residual.
Exam tip
Residual benefit = (income loss ÷ prior income) × monthly benefit, with thresholds.
Common mistake
Applying a flat 50% to a residual claim.
What this tests
CISRO competency component 2.1 — Analyze the available products that meet the client's needs — which is weighted at 30% of the Accident & Sickness module. Written against the published curriculum.
More from component 2
- A group benefits booklet lists AD&D coverage alongside life and LTD. The AD&D benefit pays:
- A hospital indemnity (hospital cash) policy pays:
- Employment Insurance sickness benefits are available to:
- Which government program coordinates with an individual DI policy through a possible offset AND also affects the definition of insurable income?
- A group plan's 'eligibility waiting period' (probationary period) is:
- A CI policy that is 'convertible' allows the insured to:
Practice the whole Accident & Sickness module
Timed sets weighted like the exam, and review of every question you miss. Free to start.