Short-term income protection

[PhamThinhLe]

From the course note

"Hence shorter-term income protection that covers between two and five years can be an alternative..."

Does this mean
1. The benefit paying period is capped between two and five years, but the policy term will still last until normal retirement age?
2. The policy term is between two and five years?

Thanks for any reply.

 

[Em Francis]

From the course note

"Hence shorter-term income protection that covers between two and five years can be an alternative..."

Does this mean
1. The benefit paying period is capped between two and five years, but the policy term will still last until normal retirement age?
2. The policy term is between two and five years?

Thanks for any reply.

Hi
The benefit will be capped between two and five years. There may then be different versions available: The cheapest being cover that ceases once any benefit is taken, so that the policy term ends when the benefit term ends. However, a more expensive version, may allow separate periods of benefit, but then will be more of a longer term policy.