Under California law (CIC Sections 10128.1-10128.4), when a group disability policy is discontinued and an employee was totally disabled on the date of discontinuance, the continuation of that employee's coverage is called:
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
CIC Section 10128.1(e) defines extension of benefits as the continuation of coverage under a particular benefit provided under a policy following discontinuance, with respect to an employee or dependent who is totally disabled on the date of discontinuance. California's rules on discontinuance and replacement of group disability insurance use this mechanism so that people already receiving disability benefits do not lose them when the employer's plan ends. It is distinct from conversion to an individual policy and from replacement coverage provided by a succeeding carrier.
Why the other options are wrong
- B) Conversion privilege generally allows a member to convert to individual coverage; extension of benefits continues the existing coverage for a disabled person.
- C) Premium waiver is a policy feature excusing premiums during disability, not a discontinuance-related continuation.
- D) Replacement coverage is the benefits provided by a succeeding carrier, not the continuation for an already-disabled employee.
Memory hook
Already disabled when the group plan ends? California extends the benefits. The checks don't stop at the policy's door.