Elimination periods are a characteristic of which type of policy?

• A. Disability income policy
• B. Major medical expense policy
• C. Whole life policy
• D. Cancer insurance policy

Answer: (A)

Elimination periods are a feature of disability income policies. They set a waiting period after you become disabled before benefits begin. This acts like a deductible for disability benefits, helping to exclude short-term disabilities and keep premiums lower. For example, with a 60-day elimination period, you wouldn’t receive disability benefits until day 61 of your disability, and only if you remain disabled through that period.

This concept isn’t a defining feature of major medical expense policies, which are structured around covering eligible medical expenses with deductibles and coinsurance for care received, not timing of disability benefits. It also doesn’t pertain to whole life policies, which provide a death benefit with a cash value component, nor is it a standard feature of cancer insurance policies, which pay benefits related to cancer diagnoses under their own terms.