Which disability policy type is typically the most generous and most expensive?

• A. Residual disability
• B. Total disability
• C. Presumptive disability
• D. Partial disability

Answer: (B)

Disability income policies differ by how they define when you’re considered disabled, and that definition drives both how much you get and how much you pay for coverage. When you’re totally disabled, you cannot perform any of the substantial duties of your own occupation (or any occupation, depending on the policy). This gives you the strongest level of protection: you receive income replacement for the period you’re disabled, often at a high benefit level and for a longer duration. Because this condition is the broadest and easiest to qualify for, it results in the largest potential payouts, which makes this type of protection the most generous—and also the most expensive for the insurer to cover.

Residual or partial disability, in contrast, pays only a portion of your benefit and is tied to income you’re still able to earn or duties you can perform after a disability. Since payments are reduced and eligibility can be narrower, these coverages cost less. Presumptive disability pays full benefits if you suffer certain defined losses (like hearing, sight, or a limb), which can be very generous in those specific situations but applies to a narrower set of conditions, so it isn’t as broad in practice as total disability.