38 terms

CHAPTER 11- MONEY IN REVIEW

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Auto Insurance
Insurance to protec a car owner in the event of an accident or damage to a vehicle.
Beneficiary
The recipient of assets passed on from the death of a friend or relative.
Break-Even Analysis
Method used to evaluate the wisdom of a finacial decision by determining the length of time it will take for the cost of the decision to be recouped.
Cash Value Insurance
Also known as permanent life insurance; premiums include a death benefit and a plan to build savings within the policy; two main types are whole life and universal life; significantly more expensive than term life insurance.
Claim
Paperwork filed with an insurance company in order to get them to cover a loss.
Collision
Portion of auto insurance that covers losses due to vehicle damage in an accident.
Comprehensive
Pays for damage to your car that is not a result of an accident.
Co-Pay
In regards to health insurance, paying a set amount per medical visit.
Coverage
Applies to the amount of protection you have through an insurance company in the event of a loss.
Deductible
Amount you have to pay out-of-pocket for expenses before the insurance company will begin to cover all or a portion of the remaining costs.
Elimination Period
Amount of time that lapses after a disabling event before the insurance company begins to pay benefits.
Extended Replacement Cost
Part of homeowner's insurance policy that pays a percentage beyond the insured price of the home for purposes of rebuilding it in the event of a catastrophic loss. if you do not update this, it will not cover the appriciation of your home (e.g. house is insured for $200,000, but the value goes up o $300,000, you are covered for the $200,000 plus whatever the coverage states).
Guaranteed Replacement Cost
Part of homeowner's insurance policy that pays for the full cost of replacing damaged property without a deduction for depreciation and without a dollar limit.
HSA
A helth insurance plan for self-employed people containing a large deductible. Money saved in this account grows tax deferred. It can be used for medical care with no penalties and no taxes, and may be kept if unused.
Health Insurance
Covers you in the event of illness or injury.
Homeowner's Insurance
Policy that covers a loss due to damage, theft, or injury within one's home.
Level Term
This means you pay the same amount for the entire term of the policy.
Liability Insurance
Policy that protects an individual in the event of a lawsuit due to injury on one's personal property or as the result of an automobile accident.
Life Insurance
Type of insurance designed to replace income lost due to death; traditionally two types: term and cash value.
Long-Term Care Insurance
Policy that covers the cost of nursing home or in-home car; recommended for everyone over age 60.
Long-Term Disability
Disability insurance designed to replace lost income for a period of five years or greater.
Maximum Payment
The amount an insurance company will pay before you are dropped from coverage. With health insurance keep at least a one million dollar maximum pay.
Mortgage Life Insurance
Insurance policy that pays off the remaining balance of the insured person's mortgage at death.
Occupational Disability
Type of insurance that provides an income in case the insured becomes unable to perform the job he/she was educated or trained to do.
Out of Pocket
What you have to pay.
Permanent Disability
Disabilities that are ongoing and are not expected to end.
Policy
Describes the type of coverage in an insurance agreement.
Premiums
Amount you pay monthly, quarterly, semiannually or annually to purchase different types of insurance.
Renter's Insurance
Type of insurance that provides coverage for accidents, damages and losses in a rental (apartment or house) or dormitory. Renter's insurance provides coverage for personal belongings and liability that may occur from an accident in the insured home.
Restoration Services
Part of identity theft insurance that assigns a counselor to clean up the mess made when your identity was stolen.
Self-Insured
Condition of wealth at which time one no longer needs an outside insurance policy to cover a loss.
Short-Term Disability
Minimal period of incapacitation; often used descrie an insurance policy that insures one's income for the immediate future following an incapacitation event.
Stop-Loss
Total out-of-pocket expenses for health insurance; once reached, insurance will pay 100 percent.
Term Insurance
Life insurance coverage for a specified period of time.
Umbrella Liability Insurance
High-limit insurance policy that acts as a protective covering over your home and car insurance against liability caused by an accident.
Universal Life
Type of life insurance policy, similar to cash value but with better projected returns.
Variable Life
Type of life insurance that is similar to cash value, but buys into mutual funds to project better returns.
Whole Life Insurance
Type of insurance that contains a low-yield savings plan within the insurance policy; more expensive than term life insurance.