Connecticut Life & Health Insurance Practice Exam 2026 – All-in-One Study Resource for Exam Success!

A group long-term disability income policy paid by an employer typically provides benefits based on a percentage of the insured's wages. This characteristic ensures that the benefit amount is related to the income the insured earns, making it a more equitable solution for employees who may lose their income due to a disability. The goal is to replace a portion of the lost wages, allowing individuals to maintain a standard of living while they are unable to work.

This percentage-based approach helps tailor the benefits to the individual's financial needs and is often a key feature that distinguishes it from other types of policies. It also aligns with how many other insurance products operate, focusing on providing financial assistance proportional to a person's earnings, which is particularly important in evaluating the impact of a disability.

In contrast, a fixed benefit amount regardless of income would not adequately reflect the needs of different employees with varying salaries. Similarly, linking the benefit to savings or varying it based on age does not directly relate to the income lost due to a disability, making those options less aligned with the primary purpose of long-term disability income insurance.