Vocab Schmocab
The fixed amount you pay regularly to keep your insurance policy active.
What is a premium?
One advantage of choosing a high deductible is this benefit.
What is a lower premium?
According to the age-based premiums, this age group typically pays the highest car insurance rates.
Who are teenage drivers (around age 16)?
This is the maximum amount an insurance policy will pay for a covered loss.
What is a coverage limit?
This is the main purpose of having auto insurance.
What is protecting yourself against unintentional costs and financial losses?
This is the amount you must pay before your insurance company begins to cover a claim.
What is a deductible?
This discount typically requires students to maintain at least a 3.0 GPA.
What is a Good Student Discount?
Insurance works by spreading risk among many people in this type of system.
What is risk pooling (or shared risk)?
If your deductible is $1,500 and damages are $6,000, this amount must be paid before insurance contributes.
What is $1,500?
If your car (with a car loan) is stolen and you don’t have auto insurance, this still must be paid in full.
What is your car loan?
This is the chance that something harmful or costly might happen.
What is risk?
This coverage protects you if the other driver in an accident does not have insurance.
What is uninsured motorist coverage?
Selling your bike to avoid theft is an example of this risk management strategy.
What is risk avoidance?
If damages exceed your policy’s coverage limit, this person must pay the remaining balance.
Who is the policyholder?
The $500 Anthony must pay before his insurance covers the claim is called this.
What is a deductible?
Protects belongings from risks like theft.
What is renters insurance
This type of coverage pays for damage to your own vehicle after a crash, regardless of fault.
What is collision coverage?
Buying a strong lock is an example of this strategy.
What is risk reduction?
Increasing your deductible usually causes this to happen to your premium.
What is it decreases (goes down)?
This type of car insurance covers damage you cause to your neighbor’s house in an accident.
What is property damage liability insurance?
A policy that will pay a specified sum to beneficiaries upon the death of the insured.
What is life insurance
Age, driving record, and this personal factor all influence your insurance rates.
What is location (or where you live)?
Taking out insurance to cover theft is an example of this strategy.
What is risk transfer?
Premiums, deductibles, and limits together determine this about your policy.
What is the cost and amount of coverage?
When Meri’s roof is damaged by a hurricane, this is what her homeowners insurance helps pay for.
What is the cost of roof repairs?
The maximum amount a policy will pay, either overall or under a particular coverage.
What is the policy limit
Auto insurance requirements vary depending on this.
What is the state you live in?
Hoping nothing happens and doing nothing about risk is known as this approach.
What is risk retention (or accepting the risk)?
Paying your premium on time helps keep your policy in this status.
What is active (or in force)?
Zack should purchase short-term disability insurance for this reason.
What is monetary protection if he is unable to work due to illness or injury?