If you misstate your age when applying for Disability Income insurance, what consequence may occur at claim time?

When applying for Disability Income insurance, if an individual misstates their age, the insurance company has specific protocols to handle this situation. If the stated age is lower than the actual age, the insurance company is likely to calculate the benefits based on the correct age, which often results in reduced benefits. This is because disability income benefits are typically determined by various factors, including the insured's age at the time of policy issuance and the benefit amount they are entitled to receive.

If the insurer discovers the misstatement at the time of a claim, the benefits will not be enhanced based on the incorrect (younger) age, nor will they remain unaffected. Instead, they will adjust the payout to reflect what the benefits would have been had the correct age been disclosed, which typically means a reduction in benefits since older individuals often receive lower payout amounts due to shorter life expectancies and higher risk. Therefore, the correct answer accurately reflects the consequence of misreporting age: benefits will be reduced if the actual age is higher than what was stated on the application.