7.10.1.

L1 Note taking guide

Types of Insurance Essentials Note-Taking Guide

Daloton Langley Name__________________
39 Total Points Earned Total Points Possible Percentage
INSURANCE Policyholder:
is the consumer who purchased the policy

4/10/14 Date__________________

career prep Class _________________

Risk:

Insurance:
is an arrangement between an individual (consumer) and an insurer (insurance company) to protect the individual against risk.

Policy:
is a contract between the individual and the insurer specifying the terms of the insurance arrangements.

is uncertainty about a situations outcome

Premium:
is the fee paid to the insurer to be covered under the specified terms

Deductible:
is the amount paid out of pocket by the policy holder for the initial portion of a loss before the insurance coverage begins.

AUTOMOBILE INSURANCE Liability Medical payment Uninsured/under insured Physical damage

covers damages caused to the vehicle. Two optional forms of coverage are available:

Types

covers the insured if injuries or damages are caused to other people or their property.

covers injuries sustained by the driver of the insured vehicle or any passenger regardless of fault

covers injury or damage to the driver, passengers, or the vehicle caused by a driver with insufficient insurance.
no

Collision
covers a collision with another object, car, or from a rollover

Comprehensive
covers all physical damage losses except collision and other specified losses

Required by law Who/ what is covered

yes

no
covers the injuries sustained by the driver

no

covers the insured if there are injuries

injury damage

covers pedestrians

Family Economics & Financial Education October 2010 The Essentials to Take Charge of Your Finances Types of Insurance Page 10 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona

7.10.1.L1 Note taking guide

HEALTH INSURANCE Why is it important to purchase health insurance? Provides protection against: May cover: How may health insurance be purchased?

so you don't have to pay a lot of money when you get hurt

injuries

hospital or doctor visits

through an agent

Children may stay on their parents health insurance until:

26
LIFE INSURANCE Life insurance:
is a contract between an insurer and policyholder specifying a sum to be paid to a beneficiary upon the insureds death

Beneficiary:

Dependent:
is a person who relies on someone else financially. Life insurance is not necessary if a person is single with no dependents

is the recipient of any policy proceeds if the insured person dies.

Who should purchase life insurance?

everybody who is about to die and plans to give it to there dependants

DISABILITY INSURANCE Disability insurance:

replaces a portion of ones income if they become unable to work due to illness or injury.

If needed, how much does disability insurance pay an individual?

The insurance typically pays between 60% 70% of ones full time wage

HOMEOWNERS AND R ENTERS INSURANCE Peril:

is an event which can cause a financial loss like fire, falling trees, lightning, and others.

Renters insurance:
protects the insured from loss to the contents of the dwelling rather than the dwelling itself.

Homeowners insurance:

combines property and liability insurance into one policy to protect a home from damage costs due to perils

Property insurance:
protects the insured from financial losses due to destruction or damage to property or possessions.

Why is it important for a renter to purchase renters insurance?

in case a fire or flood comes and wipes out there stuff it can be replaced
Covers:
It covers major perils, provides liability protection, and provides for additional living expenses if the dwelling is rendered uninhabitable by one of the covered perils

Liability insurance:
protects the insured party from being held liable for others financial losses

Family Economics & Financial Education October 2010 The Essentials to Take Charge of Your Finances Types of Insurance Page 11 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona