Question

Steve has a group disability income policy where the premiums are paid by his employer. He elected to pay for additional residual disability coverage. Which of the following statements is true?

Option 1: Steve is responsible for paying the premiums for his group disability income policy, including the additional residual disability coverage.
Option 2: Steve's employer pays the premiums for his group disability income policy, but Steve is responsible for paying the premiums for the additional residual disability coverage.
Option 3: Steve's employer pays the premiums for his group disability income policy, including the additional residual disability coverage.
Option 4: Steve's employer pays the premiums for his group disability income policy, but the additional residual disability coverage is not available in his policy.

Answer 1

Steve's employer pays the premiums for his group disability income policy, but Steve is responsible for paying the premiums for the additional residual disability coverage.

Step-by-step explanation:

The correct statement is Option 2: Steve's employer pays the premiums for his group disability income policy, but Steve is responsible for paying the premiums for the additional residual disability coverage.

In a group disability income policy, the employer typically pays the premiums for the base coverage, which provides a certain level of disability benefits. However, if employees want additional coverage, such as residual disability coverage, they may need to pay for that themselves.

In this case, Steve elected to pay for additional residual disability coverage, so he is responsible for paying the premiums for this extra coverage, while his employer covers the premiums for the base policy.