When is an insured indemnified under a disability income policy?

An insured is indemnified under a disability income policy primarily when they are permanently and totally disabled. This situation means that the insured is unable to engage in any substantial work or perform any meaningful activities due to their disability, resulting in a complete loss of income. Disability income policies are designed to provide financial support to individuals who cannot work due to such severe conditions.

While the other scenarios involve forms of disability, they do not necessarily meet the strict criteria for indemnification under many disability income policies. For instance, temporary disabilities may not qualify for long-term benefits, and minor or partial disabilities usually do not trigger the full benefit payouts associated with permanent and total disabilities. The focus of a disability income policy is on providing adequate financial protection to individuals who face long-term consequences from their disabilities, therefore reinforcing the significance of the correct answer.