If an insured has a Disability Income policy with a 30-day Elimination Period and a monthly benefit of $500, what is the maximum amount they would receive after being disabled for 3.5 months?

To determine the maximum amount an insured person would receive from a Disability Income policy, it's essential to first calculate the number of months the benefit would actually be paid after the elimination period. In this scenario, the policy has a 30-day elimination period, which equates to one month since benefits will start paying after that period is completed.

Once the elimination period is over, the insured will begin receiving the monthly benefit. Given that the disability lasts for 3.5 months, we need to account for the one month of the elimination period first, leaving 2.5 months during which benefits are paid.

The monthly benefit is $500, so for the 2.5 months, the calculation would be:

• 2.5 months × $500/month = $1,250

Thus, the maximum amount they would receive after being disabled for this length of time would indeed be $1,250. This calculation accurately reflects how disability income insurance works, particularly with respect to the elimination period and the subsequent benefits that are provided.