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What you buy to protect yourself from financial loss due to illness, injury or damage
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The amount you pay in exchange for insurance to the insurance company
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Chapter 14
Consumer Education
| Question | Answer |
|---|---|
| What you buy to protect yourself from financial loss due to illness, injury or damage | insurance |
| The amount you pay in exchange for insurance to the insurance company | premium |
| When you buy insurance you buy this | policy |
| This is an agreement to be protected by an insurance company | policy |
| After you buy a policy you then become the | policyholder |
| What you file in the event you do have a loss | claim |
| Insurance protects you against something of what? | value |
| Something of value that if lost would cause you financial harm | insurable interest ( ex. You can insure your own car but not your brothers) |
| An experts determine the value of a piece of property | appraisal |
| Insurance that protects you from financial loss when things you own are stole, damaged or destroyed(typically gotten for homes, cars, value posses.) | property insurance |
| Protects you from losses(injury) that you cause others(mailman trips on your stairs) | liability insurance |
| Insurance the protects you , your spouse, and your children due to illness, disability, or death | personal insurance |
| Coverage for you when you are legally responsible for injuring other people in an automobile accident(usually show in two numbers 250,000/500,000 first is max for one person and second is maximum total) | bodily injury liability coverage |
| Pays for the damage you cause to another person’s property-this is not your car(250,000/500,000/50,000 the last number is what company will pay up to in the damage you cause to others property | property damage liability coverage |
| Pays medical and funeral expenses for you, your family members and other passengers in your car because of injuries that happened in an accident (does not matter who cause accident) | medical payment coverage |
| Pays medical and damage expenses for you and your passengers cuased by a driver without insurance or with too little insurance to cover the loss | uninsured/underinsured motorist coverage |
| Pays for damage to your car caused by something other than a collision(fire, earthquake, wind, hail, floods, vandalism, theft)(has deductibles) | comprehensive insurance |
| Pays for damage to your car caused by colliding with another car or object(has deductibles) | collision coverage |
| Amount you pay before the insurance company pays anything | deductibles |
| Factors that affect your premium | age-umarried males 16-25 pay higher rate, single pays more, grades- good grades has lower premiums, driving record-many accidents is higher premium, type of car-sport is higher, age-older get better rates, residence-city vs. suburbs and distance from city |
| Provides personal property and liability protection for you home | homeowners insurance |
| Covers damage to or loss of your house and content( garage, sheds, furniture, appliance, curtains, clothes) | personal property |
| Things that may not be covered by their full value ( computer, silverware, valuable jewelry, cash-may need to get rider) | exclusions |
| Provides the same property and liability coverage as a homeowner policy but does not cover structure itself ( owner/landlord is responsible for theses losses) | renters insurance |
| Factors affecting the cost of homeowners insurance | location, age of house, distance from first station/hydrant, what house is constructed of |
| Health insurance covers | new drugs, medical equipment, treatment procedures, advances in medical technology |
| Lawsuits against health car providers is _____ to the cost of health care | rising |
| The average settlement for when the doctor/hospital is at fault for damage or death | 1 million |
| Coverage for doctors in the event there is physical damage or death of a patient( can cost up to $150,00 a year) | malpractice insurance |
| What does basis coverage in hospital covers | room and board, routine nursing care, medical supplies, lab testing, operating room, x-ray equipment |
| surgery covers | Surgeon’s fees to do the procedure |
| outpatient services covers | some portions of doctors fees for nonsurgical care in office, hospital and your home |
| visit to doctors for routine health care | x-rays, lab test |
| major medical covers | a share of the enormous cost resulting from a serious illness or accident, extended hospital care, physical therapy, multiple operations |
| coverage for part or all of prescription pending on pan(excludes depression drugs, contraceptive, diet and experimental drugs) | medications |
| medication that have the same composition as their name brand but less expensive | generic drugs |
| dental care covers/includes | cleaning, check ups, x-rays, filings/crowns/surgery, repair of teeth due to an accident |
| vision care covers | eye injuries, eye disease, does not cover routine exams or eyewear |
| What insurance does not cover | cosmetic surgery, regular check ups if no medical problem, policies cover check up every 3 months for 1st life |
| Allows you to exceed your limit that health insurance will pay, usually covers medical expenses only for the disease that’s specified in the policy | catastrophic and specified-disease insurance |
| Cover cost of someone taking care for you, pa a set amount per day for person that is caring for you | long term care insurance |
| Replace lost income when you cannot work due to illness, pas about 60% of income @ the time you purchased that policy | disability income insurance |
| Fee for service plans covers | medical expenses, surgical expenses, hospital expenses |
| Pay for health service as you need them( must pay a deductible) | fee for service plan |
| A deductible ranges from | $100-500 |
| Prepaid plans, you pay healthcare coverage in advance instead of paying for services as you use them(insurance company controls cost of healthcare by negotiating fees with providers who want to participate in plan) | manage care plans |
| Specific amount you pay for services regardless of the cost of those services | copayments |
| Three types under managed care plan | HMO, PPO, POS |
| Managed care plan that charges a set amount for each member each year(small copayment), must have primary care physician for all health issues( if emergency doctor will refer to specialist) if go out of plan then have to pay full cost | Health maintenance organization(HMO) |
| Managed car plan most like a fee-for service, provides offer care to reduced price, no required doc/hospital, if go out of plan(pay certain %, pay difference between do charg/plan will pay) | Preferred Provider Organization(PPO) |
| Combination of HMO and PPO, must select primary care physician, may go outside the plan for healthcare but physician must refer you to | Point of Service Plan(POS) |
| Most individual get health insurance through their employers, companies pay the premium(sometimes) | group health insurance |
| The cost to purchase insurance | premium |
| Enroll in plan upon being hired | open enrolment, part time employees are not usually covered by health insurance |
| Requires your employer to offer to continue your health coverage for 18 months after you leave, must pay entire premium, not your employer | Consolidated omnibus budget reconciliation act(Cobra) |
| Medical condition diagnosed or treatment before you join a new insurance plan | Pre-existing condition |
| You new insurance plan must cover any pre-existing conditions without a waiting period if you have been insured continuously the previous 12 months, (july 1, 1997) | health insurance portability act(HIPA) |
| Individual health insurance does what? | allows more flexibility, more expensive, more variety of choices |
| Provides low cost medical insurance for older Americans( must be 65+ or hav certain disabilities) | medicare |
| Supplemental insurance sold by private insurance companies, not the gove( ex. AFLAC) | Medicaid |
| Coverage for individual with low incomes or disabilities regardless of age, supported by federal, state government. It is ran by state. | Medicaid |
| injured workers who receive 2/3 of their salary while they are disabled from something that happened to them on job( if death, family will receive compensation) | workers compensation |
| A request from your primary care physician for services from a particular specialist | referral |
| Protect you and your family financially in the event that a family member dies | life insurance |
| When purchasing life insurance, you specify who will receive the payment, that person is the beneficiary, you can have more than one, usually spouse/children | death benefit |
| Pays a death benefit if policyholder dies within a specified period of time | term life insurance. |
| Pay a fixed benefit for a fixed premium over a specified number of years( terms can be 5,10,15,20) | level term life insurance |
| Allows you to renew your policy each year, insurance company is not allowed to cancel the coverage if you become ill or as you grow older but its your responsibility to renew | Renewable term life insurance |
| At any time during the term, you can choose to convert the policy into a permanent policy | convertible term life insurance |
| Provide a death benefit plus a savings plan and the coverage lasts throughout the policy holders life | Permanent life insurance |
| Things to consider when buying life insurances | family responsibilities, financial situation, future, special needs |
| The permanent life insurance is | more expensive then term, can cash the policy in the cash value of the policy, use for retirement |
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Brightonvball