Auto/health/life insurance
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38 terms
Terms | Definitions |
|---|---|
 "driving a car is the largest single exposure to catastrophic losses for most americans | ... |
| Auto insurance provides liability and property coverage | ... |
| True or false, it is illegal to operate a motor vehicle without auto insurance | True |
| What is liability insurance? | Covers the insured if they are deemed responsible |
| Automobile bodily injury liability | covers bodily injury suffered by others |
| Automobile property damage liability | covers damage to the property of others. includes damage to other cars, buildings, signs, etc. |
| What is medical payment coverage? | covers bodily harm of insured driver and passengers. medical losses and bills within 1 yr of accident |
| what is physical damage coverage? | protection against loss or damage to one's car |
| what is collision insurance? | covers losses from collision with another car or object |
| What is comprehensive insurance? | covers collision, rollover, fire, theft, vandalism, wind, hail, etc |
| What is hmo health insurance? | payment in advance for health care coverage |
| Traditional health insurance | reimbursement for medical expenses, patient makes choice of where to receive care. |
| what is ppo health insurance? | group of health care providers, have contract with insurance company, discounted services |
| what is psn health insurance? | health care providers and hospitals, offer a health insurance contract, work as a group |
| Health savings accounts (HAS) | tax deductible savings account, individuals and employers deposit into it, used to pay medical bills and deductibles |
| Health reimbursement arrangements (HRA) | funds contributed by employers, funded solely by employers |
| What are the two primary risks of buying health insurance? | 1. risk of living too long 2. risk of dying too soon |
| Why buy life insurance? | protects family from your financial burdens when you die |
| policy (term) | Contract between issuer and policy holder stating terms and dollar amounts |
| Death benefit (term) | amount that will be paid to beneficiary |
| policy holder (term) | owner of policy who retains all rights given by policy |
| Beneficiary (term) | person(s) who are designated to receive the death benefit |
| face amount (term) | the amount of coverage given in the event of the policy holder's death |
| premium (term) | charge to the policy holder for insurance coverage. monthly, quarterly, or annually |
| term insurance | pure protection against early death, face amount, pays benefits only if the insured dies |
| term insurance types | 1. guaranteed renewable return 2. level-premium term 3. decreasing term 4. convertible term 5. group term |
| guaranteed renewable return | typical for term, protects against becoming uninsured |
| level-premium term | avoid increasing premiums with age, premiums set an average rate over time, can cover from 5-20 years |
| decreasing term | face amount of coverage declines. premiums remain constant. closely matches coverage with needs |
| convertible term | option of converting to cash value |
| group term | employer plan, based on health of whole group |
| cash value insurance | pays benefits at death and includes a savings/investment element |
| cash value insurance types | 1. limited-pay insurance 2. adjustable insurance 3. universal insurance 4. variable insurance 5. variable-universal insurance |
| limited-pay insurance | premiums paid for a period of time, protected for life |
| adjustable insurance | allowed to adjust premiums, face amount, and cash value accumulation |
| universal insurance | pure protection (term), cash-value, variability of face value, premiums, and a rate of return |
| variable insurance | you choose your investments, face value and cash value may vary |
| variable-universal insurance | choice in investments, higher returns, most popular, higher commissions, annual fees |
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