Risk & Insurance Basics
Buying insurance, shifts the ______ from your wallet to the insurance company.
Risk
Lawyers or doctors often need this kind of coverage in case they make a costly professional error.
Professional liability insurance
The insurance company agrees to step in and cover certain losses when you pay this recurring fee monthly or annually.
Premium
A person who drives safely and avoids tickets still will want this type of insurance to cover injuries to another person.
Liability
A person reports damage to their insurance company in order to start this official request.
Claim
Most people agree to pay small, regular fees so they don’t face this much larger possibility.
A potential major loss
This form of insurance is meant to support your family financially if you are no longer alive to provide income.
Life Insurance
This is the amount you must pay (out of pocket) first before your insurer contributes toward a claim.
Deductible
Two people have car insurance one has a $500 deductible and the other has a $1000 deductible. Whos premium will be cheaper?
$1000 deductible.
If your car is hit by a deer, this type of auto coverage is the one that would help pay for repairs
Collision
The type and amount of insurance one needs is based on what?
Risk tolerance and your financial situation?
This type of car insurance covers damage to your vehicle caused by events such as fire, animals, weather, or theft.
Comprehensive
What are 3 major life changes that will affect your insurance needs.
Children, Buying a home, Buying a Car, etc.
Why do we not want to file too many insurance claims?
Because our premium will cost more.
Insurance is a key part of your overall _______ plan.
Financial
The term risk according to insurance means what?
Possibility of injury, damage, or loss.
Medicaid and Medicare fall under this category of insurance programs.
Government health insurance programs
What are 3 factors that will affect the cost of your premium?
Age, Health, Medical History, Hobbies, Driving Record.
How can we lower our premium on our car insurance?
Taking a defensive driving course or installing safety devices in your car are ways to show the insurer you’re a lower risk and reduce this.
This type of insurance allows for investment options.
Permanent life insurance.
Why do teens and elderly people pay more for insurance?
Because they are more of a liability
A policy someone buys to protect part of their income if a serious injury prevents them from working.
Long-term disability insurance
This is the cost of normal doctors visits.
Co-Pay
You must be disabled or at least this old to apply for medicare?
65
Health insurance and disability insurance serve different functions what are they?
Health insurance covers your medical costs. Disability covers lost income.