Professional Documents
Culture Documents
9-6-16 Insurance
9-6-16 Insurance
9-6-16 Insurance
Happy Fight
Procrastination Day!
HHS
IDENTIFYING RISK
What helps to minimize risk?
What types of insurance should
you have?
INSURANCE QUIZ
1.
False
INSURANCE QUIZ
2. Auto insurance is required by law
to drive an automobile.
True
INSURANCE QUIZ
3. Insurance plays a small role in
most individuals financial plan.
False
INSURANCE QUIZ
4. Most individuals or families
can afford health care and
medical expenses.
False
This is a large reason why the Affordable
Care act was established.
INSURANCE QUIZ
5. Life insurance is necessary for
everyone.
False
INSURANCE QUIZ
6. Disability insurance is
necessary only for people with
disabilities.
False
INSURANCE QUIZ
7. When renting an apartment, the
renter should purchase renters
insurance because the owners
insurance will not cover the renters
possessions.
True
Risk - chance
of loss from an
event that
cannot be
entirely
controlled
savings - at
least six
months of
expenses set
aside to cover
costs of
unexpected
events
is managed
by
INSURANCE POLICY
Policy - A contract that specifies what risks are
covered and how much will be paid for losses
Coverage - The risks covered and amount of
money paid for losses under an insurance
policy
Policyholder - Person who owns the policy
AN ILLUSTRATION OF HOW
INSURANCE WORKS
Suppose there
are 100 people
in a group
With a 1%
chance that any
one of them
could get sick
and require
$10,000 in
medical care
So, everyone
gives up $100,
but nobody loses
more than $100
But, no one
knows who
will get sick
99 people do not
collect anything, but
they gain peace of
mind and important
protection against a
large loss
Life
Health
Types of
Insuranc
e
Disability
Longterm
Care
If so,
policyholder
pays a
deductible
Policyholder
makes claim
to insurance
organization
Insurance
organization
determines if
event is
covered by
policy
Claim - paperwork
submitted to insurance
organization describing the
accident, illness or injury
Deductible - amount of
money paid out of pocket by
policyholder before the
insurance coverage begins
Co-insurance - amount of
money, after deductible,
that is paid jointly by the
insured and the insurance
company
LOUISES ACCIDENT
Louise has a
health insurance
policy with a
$500 deductible
and 20% coinsurance
Even
with
insuranc
e Louise
still
needs
Louise is in an
Louise pays $500 +
funds to
accident resulting
20% of the remaining
what
pay the
$4,500 for a total of
in a $5,000
then
if
$1,400
deductibl
medical
The insurance company
e and copays
$3,600
procedure that is
insuranc
covered by
e
What insurance
would Louises options have been if she did not
have insurance?
this
mean
s
Carlos has a
property and
liability insurance
policy with a $500
deductible and 0%
co-insurance
$500
$3,28
8
Current Policy
New Policy
$300
$200
$200
$2000
20% owed by
policyholder
80% owed by
insurance
organization
0% owed by
policyholder
100% owed by
insurance
organization
SOURCES OF INSURANCE
In most cases, individuals acquire insurance from a
combination of sources
Long-term
care,
property
and liability
insurance
Individual
Employ
er
Health,
disability, and
occasionally
life insurance
Special
programs for
those who
qualify and
during
catastrophes
Governme
nt
Insurance
premiums
paid by
Employer
Employee
In-kind income
the provision of
a product or
service rather
than cash
Payroll deduction
GOVERNMENT PROGRAMS
Provide basic insurance as a part of the
Hospita
l bills
Medical
procedu
res
Mental
health
treatme
nt
Vision
care
Provided
by
HEALTH
Preventati
ve care
Dental
care
Prescrip
tion
drugs
Why are
both
disability
and longterm care
insurance
important?
Payment to
replace
earnings during
times when
workers cannot
work due to
illness or injury
Provided by
employers,
individuals,
and/or
government
Long-term
care
insurance
Payment for
extended care
when a person
cannot live
independently
(but doesnt
need to be
hospitalized)
Provided by
individuals
Two
parts
Provided by individuals
Pays for
loss to
insured
person
Pays for
injury or
loss to
others
payment for
damage/loss of property
in a rental unit in
addition to liability
losses
If a person
drives an
automobile,
automobile
liability
insurance is
required by law
LIFE INSURANCE
Life
insurancepayment to
beneficiaries if
an insured
person dies
Beneficiarysomeone who
receives
insurance
money if the
insured person
dies
Provided by
employers and/or
individuals
May cover paid and
unpaid work
formerly done by the
individual
Household
production- unpaid
work, such as child
care or meal
preparation
When would it be
necessary to
purchase life
insurance?
IN REVIEW
Insurance is
an important
part of a
financial plan
Insurance is not
intended to make
an individual
better off than
before the event
Even with
insurance, an
individual
should still have
funds to pay the
deductible and
co-insurance
Insurance
may be
acquired from
multiple
sources
There are
several types
of insurance
for specific
purposes
REVIEWING INSURANCE
Different types of insurance:
Auto insurance
Life insurance
Homeowners/Renters insurance
*Healthcare insurance
INSURANCE QUIZ
On a separate sheet of paper write your
(H,L,A)
explain which specific part of your insurance would
QUESTION #1
QUESTION #2
You lose control of your car and it
rolls.Your car cant be repaired,
so you need to purchase a new
car.
QUESTION #3
You let your best friend borrow
your car. She is sideswiped by
another car on the highway.
QUESTION #4
The house you own is destroyed
by a tornado and you need to
rebuild.
QUESTION #5
A man nearing retirement lets his life
insurance policy lapse and must
find coverage.
QUESTION #6
Someone breaks into the
apartment you rent and steals
your television.
QUESTION#7
While driving a car, you cause an
accident that injures someone
else.
QUESTION #8
You have a water leak in the home
you own and need to replace the
flooring and cabinets in the kitchen.
QUESTION #9
A young married couple has their
first baby.
QUESTION #10
There is a fire in the apartment you rent and you need to
QUESTION #11
An unexpected death of a family
member results in funeral
expenses.
QUESTION #12
While driving your car, you hit a tree.
Your car must be fixed by a
professional repair shop.
AGENDA
Warm-Up
HOMEWORK
Finish Mind Map as needed