Budgeting
This is the term for take-home pay after taxes and deductions; it’s what you use when making a monthly budget
Net Income
Give one example of why we need insurance.
Build wealth, Transfer risk, Manage assets, or Build relationships
Provide two factors that affect your premium
Age, Gender, Married/Single, Driving Record, Type of Car, Where You Live, Deductible, Credit Score
a fixed amount you pay for certain visits/services
Copay
Name three main categories that are usually considered “regular spending” in a monthly budget.
Housing, Food, and Transportation
The term where you pay a monthly or annual payment to maintain your insurance policy
Premium
Name two types of coverages
After your deductible, you split the costs by percentages
Coinsurance
If you have an annual salary of $84,000, then what is your monthly gross income?
$7000 per month
If you choose a high premium, then explain what happens to your deductible
High premium = Low deductible
If you cause an accident worth $7000 and your deductible is $750, then how much does your insurance pay?
$6250
Name two types of metal plans
Bronze, Silver, Gold, and Platinum
Define “lifestyle creep” and give one example of a change someone might make when they experience it
When your spending increases due to an increase of income - like upgrading your car immediately.
This type of insurance is legally required in every U.S. state
Auto insurance
This type of auto insurance coverage is legally required for drivers in every U.S. state to help pay for damages or injuries they cause in a car accident.
Liability
If you are under 30 years old or qualify for hardship/affordability exemption, then you can get this type of health insurance plan
Catastrophic Plan
Define the 50/30/20 rule
50% - needs
30% - wants
20% - savings
An insurance company may purchase this type of protection from another insurer to help cover large losses and reduce its own financial risk.
Reinsurance
Provide a scenario where a higher deductible makes sense.
When someone cannot afford a high premium or a high monthly payment. Or someone who is a safe driver and hopes they do not get into an accident
If your deductible is $400 and have a coinsurance of 20%, then how much do you pay for a $1,500 medical bill?
$620