If someone is covered under a Disability policy with a 30-day elimination period and has total disability for 3.5 months, how much total benefit would they receive if their monthly benefit is $500?

To determine how much total benefit someone would receive under a Disability policy with a 30-day elimination period, it’s essential to understand the concept of the elimination period and how it impacts the benefit payments.

The elimination period is a specified time that must pass before the policy starts paying benefits. In this case, the elimination period is 30 days. During this time, the individual would not receive any benefits, as they are still within the waiting period. After this period, the individual can start receiving benefits for the duration of their total disability.

Since the person is totally disabled for 3.5 months, that equals 3 months and an additional 15 days. This results in a total of 3 full months of benefits payable after the elimination period has been satisfied. The monthly benefit amount is $500. Therefore, for 3 months, the calculation would be:

3 months x $500 per month = $1,500

However, there are an additional 15 days after the 3-month mark. Since the monthly benefit is expressed as a full month, we need to calculate the prorated amount for those 15 days.

A month is generally considered to be about 30 days, so for 15 days, the calculation is