Advantage - less expensive than individual plans and the insurance company must enroll anyone who belongs to or joins the group, even if the person or dependent has a pre-existing condition that will be costly for the insurer to cover
Disadvantage - an em
group plan
an individual person or family buys insurance directly from an insurance company this is called a
individual plan
Advantage - you can have your policy written to cover your specific needs, some insurers offer discounts to individuals who have healthy lifestyles, such as nonsmokers
Disadvantage - more expensive, if you have a pre-existing condition an insurer may char
individual plan
provides health care at its own health center for a fixed fee per month
health maintenance organization
a group of doctors and hospitals that agree to provide specified medical services to members at prearranged fees, receive more coverage if they choose a preapproved health care provider
preferred provider organization
1.) the US Governments major health insurance program for the elderly
2.) Government partially pays for healthcare costs of people over 65
medicare
1.) a federally and state-funded health-care plan for people who are unable to pay for insurance or health care
2.) provides coverage for the aged, blind, disabled, and for low-income families who qualify
medicaid
the possibility of loss or injury
risk
the systematic process of managing risk to achieve your objectives
risk management
paid protection against loss due to injury or property damage
insurance
a risk that meets an insurance company's criteria for insurance coverage
insurable risk
a risk that is unacceptable to insurance carriers because the likelihood of loss is too high
uninsurable risk
a risk where conditions can be controlled to minimize the chance of harm
controlled risk
a risk that cannot be controlled
uncontrolled risk
risk with a threat of a loss with no opportunity for gain
pure risk
risk that involves the likelihood of economic loss, can result from overall business conditions
economic risk
risk associated with illness, disability, loss of income, unemployment, aging, and premature death
personal risk
The risk of damage to or loss of property due to theft, wind, fire, flood, or some other hazard
property risk
the potential for losses to others that occur as a result of injury or damage that you may have caused
liability risk
the risk of harm caused by human mistakes, dishonesty, or another risk that is attributed to people
human risk
The possibility of a catastrophe caused by a flood, tornado, hurricane, fire, lightning, drought, or earthquake
natural risk
1.) risk avoidance
2.) risk reduction
3.) risk retention
4.) risk transfer
- these are all ways of ______ risk
handling
1.) just don't do it
2.) must think about the consequences
- these are a part of risk ______
avoidance
1.) take precautions to help reduce the risk of an accident
- these are a part of risk ______
reduction
1.) taking on all responsibility if a loss does happen
- these are a part of risk ______
retention
1.) you transfer the risk of a loss to the insurance company by buying insurance
- these are a part of risk ______
transfer
the price you must pay for insurance protection for a specific period of time
premium
Many people share a loss so that no one person or business carries all the risk
principle of large numbers
the chance of loss or injury
risk
anything that may possibly cause a loss
peril
anything that increases the likelihood of a loss through peril
hazard
a contract between a person and an insurance company to cover a specific risk, in exchange for the premium, the insurance company agrees to protect the policyholder against financial loss in case of a loss that is covered by the policy
insurance policy
individual who buys insurance (customer or policyholder)
insured
the insurance company
insurer
each kind of specific loss the insured is protected against
coverage
special features added to the basic policy that increases the cost of the premium
product options
A request to cover losses that occur from a specific event
claim
amount the policyholder must pay first before the insurance company pays anything
deductible
larger deductible = ______ premiums
lower
to buy interest you must prove that the loss of a person or item would cause financial loss to the customer
insurable interest
1.) expensive sophisticated medical technology
2.) insurance industry blames consumers and attorneys who bring unreasonable claims to court, raises cost for insurance companies
3.) definite factor is the string of catastrophic earthquakes, hurricanes, flo
increasing
offers protection for family members after someone dies
life insurance
covers damage or loss to your property
property insurance
covers damage that you may have caused accidentally to someone else or to someone's property
liability insurance
provides money to pay medical bills in case of accident or illness
health insurance
protects workers who are injured on the job, required by the government and paid for by the employer, provides medical and income benefits to employees injured on the job
workers compensation insurance
insurance protects you _____ in case you have an accident
financially
one who buys the policy (insured or ______)
policyholder
1.) using your seatbelt
2.) observe your speed limits
3.) know your limits
4.) concentrate on driving
5.) be patient
- these are all things you can do to ______ risk when driving
reduce
1.) Bodily injury liability coverage
2.) Property damage liability coverage
3.) Collision insurance coverage
4.) Medical payments coverage
5.) Comprehensive coverage
6.) Uninsured/Underinsured motorists protection
7.) Miscellaneous coverage
- all of these
vehicle insurance
1.) most basic type of coverage
2.) required by most states
3.) protects vehicle owners from claims of injury or property damage to others in case they are help responsible for an accident
- this describes ______ insurance
liability
1.) covers injury to someone else
2.) all drivers must have this coverage
3.) 100/300/100
- this describes ______ ______ ______coverage
bodily injury liability
100/300/100
- the 1st number represents the coverage of injury to ______ ______
one person
100/300/100
- the 2nd number represents the coverage for the ______ per accident
total
100/300/100
- the 3rd number represents the ______ damage coverage
property
1.) covers damage to another person's vehicle or other property caused by the insured
2.) should have this coverage
- this describes ______ ______ liability coverage
property damage
1.) covers damage (resulting from a collision) to the insured/policyholder's vehicle no matter who is at fault
2.) maximum amount covered is based on the actual cash value of the vehicle
- this describes ______ insurance coverage
collision
value of the auto when it was new minus deprecation (what is is actually worth now)
actual cash value
the decline in value of an asset because of use
deprecation
1.) AKA personal injury protection
2.) covers injury to drivers and anyone else in the vehicle
3.) also covers injuries that occur while you are a pedestrian
- this describes ______ ______ coverage
medical payments
1.) covers damage to a policyholder's vehicle caused by things other than an auto accident
2.) covers falling objects, theft, flood damage, vandalism, hail, deer hit
3.) detachable or removable equipment is usually excluded from coverage
- this describes
comprehensive
a driver who is not insured
uninsured
a driver who doesn't carry enough insurance to cover a loss
underinsured
1.) protects you from people who cause accidents but cannot pay for the damages
2.) anyone riding with you is protected
3.) also protects if you are hit as a pedestrian or if you are in an accident with a hit and run driver
4.) most states require this co
uninsured/underinsured
1.) rental car coverage
2.) other things to insure such as a motorcycle, motor scooter, and a snowmobile
- this describes ______ coverage
miscellaneous
requires drivers to pay for any damages or injuries they cause in an accident required in all states in some form
financial responsibility law
most states requires some form of this, requires drivers to have a minimum amount of car insurance
compulsory insurance law
drivers involved in accidents collect damages from their own insurance company no matter who is at fault
no fault insurance
insurance companies do ______ to determine which of their policyholders are at the highest risk and therefore more likely to file a claim
studies
higher risks are charged ______ premiums
higher
lower risks are charged ______
less
______ is individualized to some degree by driving records
price
filing too many claims can cause your premiums to skyrocket or your policy may be ______
cancelled
the youngest and oldest drivers are at the ______ risk for accidents (also for fatal accidents) of any age group
highest
16-year olds are clearly the ______ risk
highest
driver ______ is a major factor in accidents
inexperience
inexperienced drivers are ______ likely to engage in speeding and other dangerous behaviors
more
seniors (over 65) are at ______ risk than teenagers for accidents because of poor eyesight and slower reflexes
higher
______ typically drive more than women
men
men are also more likely to drink and engage in other ______ road behaviors
risky
______ (fraction) of the teenagers killed in motor vehicle crashes are males (?/?)
2/3
men age ______ are 2 1/2 times more likely than women to be a fatality (?-?)
20-24
______ ______ makes an enourmous difference in risk and a substantial difference in premiums
vehicle type
expensive cards always cost ______ to insure (cost more to repair and are more likely to be stolen
more
in general, larger heavier vehicles tend to protect you ______ than smaller lighter vehicles
better
in a driving record people follow pattern of ______ behavior
established
if you receive multiple traffic tickets for moving violations, your ______ will rise
premiums
if you change your habits and you are ticket-free for awhile (usually 3-5 years) your premiums may be ______
reduced
______ cost of living = high insurance premiums
high
______ areas are typically more expensive than rural areas, more accidents occur
urban
______ commutes and using your car for business also raises premiums
longer
fatal accidents are more likely to occur in ______ areas, where drivers tend to travel at higher speeds
rural
a request for payment from an insurer for any damages covered by a policy
claim
the more money insurance companies pay in ______, the more they must charge their customers
claims
covers the policyholder for a limited period of time
insurance premiums
1.) characteristics of the driver
2.) characteristics of the vehicle
3.) different policy revisions
- ______ depend on all of these
premiums
An amount a policyholder must pay before the insurance company pays a claim
deductible
property attached to land, such as a house, business, garage, or other building
real property
possessions that can be moved, such as furniture, jewelry, and electronic equipment
personal property
1.) covers loss or damage to a rental's personal possessions
2.) covers your belongings
3.) also includes liability protection in case someone is injured in your apartment
4.) relatively inexpensive to purchase
- this describes ______ insurance
renters
1.) insured against damage due to fire or lightning
- this describes ______ ______ policy
standard fire
can add other types of protection to this basic policy
extended coverage
1.) protects property owners from the cost of injuries to others on their property
2.) pays fro medical expenses and legal fees
- this describes ______ ______
liability protection
1.) if your home is damaged and you must rent another place to live in
2.) might be a time limit and a percent limit
- this describes coverage for ______ _____ ______
additional living expenses
1.) property insurance if a business's property is damaged
2.) liability insurance covers claims by anyone injured on the businesses property
3.) also want insurance to cover potential loss of income if they have to close for a while
- this describes ____
business
1.) "combo policy"
2.) required by mortgage companies
3.) covered damage to property and personal property, additional living expenses if home is destroyed, and liability protection
4.) protect from fire, windstorms, explosions, riots, and other perils
-
homeowners
covers the cost to repair or rebuild the house if it is damaged or destroyed, most policies also cover garages or sheds detached from the house
structural protection
items such as furtniture, clothing, etc.
personal belongings
protects against costs of injury or property damage to other people
liability protection
Pays for the costs to live elsewhere while your house is being rebuilt
additional living expenses
Addition to a policy that covers specific property damage
rider
recommended to insure your home for ______% of its market value
80
1.) depends on amount of coverage and type of policy needed
2.) also determined by: amount of deductible, location, type of home, building materials in it, preventative/safety measures that the property owner takes
- this describes ______
premiums
protects those left behind, paid to person when the insured dies
life insurance
in life insurance, ______ (number) claim(s) are ever filed
1
life insurance is filed by the ______ after the insured's death
beneficiary
in life insurance, you must be able to prove ______ ______ before buying the insurance policy
insurable interest
life insurance pays the survivors the value of the life insurance policy or the proceeds/______ ______
death benefit
1.) permanent insurance
2.) provides both savings and death benefits
3.) part of the premium provides death benefits and the rest builds up a cash value like a savings account
4.) if policy is cancelled, you receive the amount of cash value at that point
cash value
1.) pay a fixed premium throughout the policyholder's lifetime
2.) policy is in force until the policyholder dies
3.) provides savings and a death benefit
- these describe ______ ______ insurance
whole life
1.) more flexibility in premium payments and benefits once the policy has built cash value
2.) can increase amount of coverage, but will need to undergo and pass a physical exam and pay the extra premium
- these describe ______ ______ insurance
universal life
1.) insurance protection
2.) expenses of the insurance company for the policy
3.) interest-earning investments for the policyholder
- these are 3 ways ______ ______ are applied
premium payment
1.) the cash value portion is invested in stocks, bonds, and mutual funds, rather than just a savings account
2.) the rest of the premium goes towards the death benefit
- these describe ______ ______ insurance
variable life
1.) covers a person for a specific period of time such as 5,10,20, or 30 years
2.) pays benefits only if the insured dies during the term of the policy
3.) if insured lives beyond the term, there is no cash value
4.) policy can be renewed but must "reappl
term
1.) type of policy
2.) amount of coverage
3.) age
4.) health
5.) occupation
6.) must take a physical
- these determine the ______ of insurance coverage
cost
percent of medical expenses that a policyholder must pay beyond the deductible (ex. 80/20)
coinsurance
a fee paid each time a serivce is used
copayment
in health care, a family policy is ______ expensive than a single policy
more
a serious health condition diagnosed before a person obtained health insurance, many policies do not cover or may exclude for a certain period of time
pre existing condition
1.) catastrophic insurance
2.) most important coverage for a serious illness or accident
3.) pays for most medical expenses in and out of a hospital
4.) may have annual deductible and/or coinsurance
5.) most policies pay 75-80% of the costs and policyhold
major medical
1.) pays for hospital care for a given period of time
2.) covers room/board, tests, x-rays, O.R. costs, nursing care, meds and treatment
3.) may include a deductible
4.) most popular type because hospitals are expensive
- these describe ______ ______ insu
hospital expense
1.) pays part of a surgeon's fee for an operation
2.) most policies set a max payment for a surgical procedure
3.) policy lists the procedures and the costs allowed
4.) major medical pics up when this coverage is exhausted
- these describe ______ ______ i
surigcal expense
1.) covers the costs of a doctor's care not involving surgery
2.) visit to doctor's office or if a doctor visits you in hospital
3.) hospital expense, surgical expense and medical expense are often combined into the basic health coverage plan
- these desc
medical expense
______ plans are least expensive form of health insurance, provided by employer and employers pays the major portion or all of the cost
group