Arkansas Life and Health Insurance Practice Exam

What does an “Own Occupation” clause specify about disability insurance?

1. It covers any occupation the insured can perform

2. It doesn’t specify duties of any occupation

3. It includes only other similar occupations

4. It's the inability to perform all duties of one's own occupation

The correct answer is: It covers any occupation the insured can perform

An "Own Occupation" clause in disability insurance specifies that it covers the insured individual for the inability to perform the duties of their own occupation. In other words, if a policy includes an "Own Occupation" clause and the insured is unable to perform the specific duties of their current occupation, they may be eligible to receive benefits even if they are able to work in a different occupation. This provides more comprehensive coverage tailored to the insured's specific occupation. Therefore, the correct answer is A. Option B is incorrect because an "Own Occupation" clause does specify the duties of a specific occupation. Option C is incorrect because an "Own Occupation" clause is not limited to only other similar occupations. Option D is incorrect because the purpose of an "Own Occupation" clause is to cover the inability to perform the duties of one's specific occupation, not all duties in general.