Chapter 9- Insurance

Question 1

Paperwork filed with an insurance company in order to get them to cover a loss for someone they insure

Answer 1

Claim

Question 2

Applies to the amount of protection you have through an insurance company in the event of a loss

Answer 2

Coverage

Question 3

Amount you must pay before you begin receiving any benefits from your insurance company

Answer 3

Deductible

Question 4

The state or quality of being obligated according to law or equity

Answer 4

Liability

Question 5

Specific amount of money that you pay when insurance only covers a portion of the costs

Answer 5

Out-of-pocket expense

Question 6

Describes the type of coverage in an insurance agreement

Answer 6

Policy

Question 7

Amount you pay monthly, quarterly, semiannually, or annually to purchase different types of insurance

Answer 7

Premium

Question 8

A legally enforceable declaration of how a person wishes his or her property to be distributed after death

Answer 8

Will

Question 9

Insurance transfers _______

Answer 9

risk

Question 10

7 Types of Coverage You Need:

Answer 10

1. Homeowner’s or Renter’s
2. Auto
3. Health
4. Disability
5. Long-Term Care
6. ID Theft
7. Life

Question 11

The best way to keep you premiums down is to raise your……

Answer 11

deductible

Question 12

Medical Payment Coverage

Answer 12

pays for all accidental medical costs within 3 years of an accident

Question 13

Collision Insurance

Answer 13

covers damage to your car if it is hit by another car or object

Question 14

Comprehensive Coverage

Answer 14

Takes care of non-collision car damage (natural disasters)

Question 15

Uninsured Motorist Protection

Answer 15

Covers cost if you are injured by an uninsured motorist or if you are injured in a hit and run incident

Question 16

Homeowner’s insurance should be (guaranteed, extended) replacement cost

Answer 16

Guaranteed

Question 17

An umbrella policy gives you additional _____ protection

Answer 17

liability

Question 18

Maximum out-of-pocket expense

Answer 18

Stop-Loss

Question 19

HSA

Answer 19

Health Savings Account (tax-sheltered)

Question 20

Basic Health Insurance policies cover…..

Answer 20

hospital, surgical, physician expenses

Question 21

Dental and Eye Insurance plans cover…..

Answer 21

only dental work and eye care expenses

Question 22

Copayment

Answer 22

Amount of money you pay to help cover a portion of your medical costs

Question 23

You should not buy long term are insurance until age…..

Answer 23

60

Question 24

At least ….. percent of people will require long term care after age 60

Answer 24

69

Question 25

Disability insurance replaces .....

Answer 25

Income

Question 26

Own Occ disability

Answer 26

Available for two years, covers income if you cannot perform the job you were trained to do

Question 27

Short term policies are a (good, bad) idea

Answer 27

Bad

Question 28

Disability should be for ....% of your current income

Answer 28

65%

Question 29

Elimination period

Answer 29

Time between disabling event and when payments actually begin (long elimination period= low premium)

Question 30

ID Theft protection should cover ..... but not ......

Answer 30

restoration, monitoring

Question 31

Term Life Insurance

Answer 31

cheap, easy to understand, no savings plan, for a specified period

Question 32

Cash Value Life Insurance

Answer 32

more expensive: funds a savings plan

Question 33

Self-Insured

Answer 33

When you are financially stable enough to insure yourself with no crippling financial consequences

Question 34

Level Term

Answer 34

When you pay the same amount for the entire term of the policy

Question 35

The recipient of assets passed on from the death of a friend or relative

Answer 35

Beneficiary