Insurance Jeopardy Joan Koonce, Ph.D.

, AFC(SM) Extension Financial Planning Specialist

Terminology & Concepts

Health & Disability Insurance

Life Insurance

Property & Liability Insurance

Other/ Supplemental Insurance

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Terminology & Concepts - 100

This is the dollar amount you pay towards your expenses before the insurance company pays their portion.

What is the deductible?

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Terminology & Concepts - 200

This is the percent of your expenses you pay after the deductible.

What is coinsurance?

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Terminology & Concepts - 300

Many insurance companies will not cover these until after a waiting period has expired.

What are pre-existing conditions?

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Terminology & Concepts - 400

This provision in an insurance policy puts a limit on the total amount you will pay out of pocket for your loss.

What is a coinsurance cap or stop-loss provision?

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Terminology & Concepts - 500

This provision in an insurance contract prevents you from being reimbursed for more than 100 percent of your loss.

What is a coordination of benefits clause?

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Health & Disability - 100

You use this type of account to pay for medical expenses with pre-tax dollars.

What is a flexible spending account?

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Health & Disability - 200

This is the most liberal definition of disability found in disability income insurance contracts.

What is own occupation?

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Health & Disability - 300

Long-term care insurance companies assess the need for long-term care by using these as benefit triggers.

What are Activities of Daily Living (ADLs)?

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Health & Disability - 400

This type of health insurance plan costs more but provides you with the greatest choices of doctors.

What is fee-for-service or indemnity plan?

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Health & Disability - 500

These health care plans limit your choice of doctors. Health Maintenance Organizations (HMOs) and Preferred Provider Organizations (PPOs) are in this category.

What are managed health care plans?

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Life Insurance - 100

Because it is temporary insurance protection and has no savings component, it costs less than other types of life insurance.

What is term life insurance?

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Life Insurance - 200

Doing this will cause the death benefit of a life insurance policy to be less than the original face value when purchased.

What is taking out a policy loan?

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Life Insurance - 300

Lump sum, interest only and life annuity are examples.

What are settlement options?

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Life Insurance - 400

This feature in a life insurance policy allows you to exchange a term life insurance policy for one that has a cash value.

What is a convertibility feature?

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Life Insurance - 500

These two types of life insurance have a savings component and allow you to choose your own investments.

What is variable life and variable-universal life?

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Property & Liability - 100

25/50/25

What is the minimum amount of automobile bodily injury/property damage liability coverage required in Georgia?
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Property & Liability - 200

This type of automobile insurance covers your losses if you are hit by a hit-and-run driver.

What is uninsured/underinsured motorist coverage?

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Property & Liability - 300

When purchasing homeowners insurance to cover your home, this is uninsurable.

What is land?
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Property & Liability - 400

You add these to your standard homeowners policy to increase coverage on items that are inadequately covered.

What are floaters?

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Property & Liability - 500

These two types of automobile insurance coverage are required by lenders.

What is collision and comprehensive?

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Other/Supplemental - 100

Low-income, blind or elderly persons can obtain health care through this program funded by the state and federal government.

What is Medicaid?

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Other/Supplemental - 200

This type of insurance only covers specific illnesses or accidents.

What is dread disease and accident insurance?

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Other/Supplemental - 300

It is a type of insurance that must be purchased if you dont pay at least 20 percent down when purchasing a home.

What is private mortgage insurance?

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Other/Supplemental - 400

This coverage pays for the difference between the vehicles value and what you may still owe on the loan.

What is gap insurance?

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Other/Supplemental - 500

People purchase these types of insurance to pay off their mortgage in the event of their death and make their mortgage payment if they become disabled.

What is credit (mortgage) life and credit (mortgage) disability income insurance?

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Insurance Terminology and Concepts

Risk
The uncertainty that you will incur a financial loss and the uncertainty regarding the size of the financial loss

Pure Risk Speculative Risk

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Insurance Terminology and Concepts

Ways to Manage Risk Avoid risk Example: Dont drive Reduce risk Example: Wear seat belts Retain or accept risk Example: Pay all or a portion of the loss Transfer or share risk Example: Purchase insurance
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Insurance Terminology and Concepts

Premium Deductible Coinsurance Co-payment Coinsurance Cap or Stop-Loss Provision Pre-existing Conditions Waiting Period Policy Limits Policy Provisions Coordination-of-benefits Clause
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Insurance Terminology and Concepts

Types of Insurance Health, Disability Income and Long-Term Care Insurance Life Insurance Property and Liability Insurance Automobile insurance Homeowners insurance Personal umbrella liability insurance
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Health Insurance
Major Types of Health Care Coverage
Basic health insurance Hospital insurance Surgical insurance Medical expense insurance Major medical insurance

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Health Care Plans

Private Health Care Plans Government-Sponsored Health Care Plans

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Private Health Care Plans

Fee-For-Service or Traditional Indemnity Plans Managed Health Care Plans
Health maintenance organizations (HMOs) Preferred provider organizations (PPOs)
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Government-Sponsored Health Care Plans Medicaid Medicare Workers Compensation

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Medical Flexible Spending Accounts

These accounts allow you to pay for medical expenses with pre-tax dollars. Money put into the account is used to pay for un-reimbursed medical expenses. Some expenses are not eligible for coverage. You either use the money or lose it.
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Disability Insurance
Disability income insurance replaces 60 to 80 percent of your income if you are unable to work due to an illness or injury. Own versus any occupation Residual clause Benefit period Elimination (waiting) period Short-term versus long-term disability
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Long-Term Care Insurance

Long-term care services are provided when a person cannot perform certain activities of daily living (ADLs) and/or is cognitively impaired. What does long-term care insurance cover? Skilled, intermediate and custodial care Home care services, physical therapy, homemakers, home health aides Assisted living, adult daycare, other care in the community Alternate care (other physician recommended services) Respite care for the caregiver These accounts allow you to pay for medical expenses with pre-tax dollars.
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Life Insurance Terms

Face Value: the benefit due upon death Insured: the person whose life is covered by the policy Policyholder or Policy Owner: the individual or business that pays for and owns the policy Beneficiary: the recipient of the benefit upon the death of the insured
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Two Basic Types of Life Insurance

Term Insurance Cash-Value Insurance
www.trustedquote.com www.trustedquote.com

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Types of Cash-Value Life Insurance

Whole Life Insurance Universal Life Insurance Variable Life Insurance Variable-Universal Life Insurance
www.lifeinsuranceindepth.com www.lifeinsuranceindepth.com

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Life Insurance Clauses

Incontestability Clause
Places a time limit, usually two years, on the right of the insurance company to deny a claim based on information provided in the application

Suicide Clause
Gives the insurance company the right to deny a claim if the inured dies by suicide within a certain period of time, usually two years

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Life Insurance Settlement Options

Lump-Sum Settlement Interest-Only Settlement Period-Certain Settlement Installment-Certain Settlement Life-Annuity or Life Income Settlement
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Types of Automobile Insurance

Bodily Injury and Property Damage Liability
Required coverage in the amount of 25/50/25 in Georgia

Medical Payments

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Types of Automobile Insurance

Uninsured and Underinsured Motorist Bodily Injury and Property Damage Collision and Comprehensive
Deductibles apply to this coverage Required by lenders if your car is financed

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Types of Automobile Insurance

No-Fault Insurance
Only available in no-fault states Your insurance pays for your losses and their insurance pays for their losses no legal battles.

www.autoinsuranceindepth.com www.autoinsuranceindepth.com
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Homeowners Insurance Terms

Replacement Cost/Value: the amount necessary to repair, rebuild or replace an asset at todays prices Current Market Value (CMV): Original purchase price minus depreciation, also referred to as actual cash value Floater Policies Inflation Protection Endorsement
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Six Basic Forms of Homeowners Insurance

Basic Forms of Homeowners Insurance Broad Form Homeowners Insurance Special Form Homeowners Insurance Renters Insurance Condominium Owners Insurance Older Homes Homeowners Insurance Policies differ based on the type of property, amount of coverage and number of perils (events that cause a loss such as fire, tornado, etc.) covered.
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Homeowners Insurance Coverage

Property Home Other detached buildings Personal property Landscaping Loss of use Liability Comprehensive personal liability No-fault medical payments No-fault property damage
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Personal Umbrella Liability Insurance

Covers liability costs after the underlying automobile and homeowners policies have been exhausted Standard amount of coverage is $1 million although higher amounts can be purchased

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Other/Supplemental Insurance
Dental and Vision Insurance Dread Disease and Accident health and Life Insurance Private Mortgage Insurance Gap Insurance
www.autoinsuranceindepth.com/gap-insurance.html www.autoinsuranceindepth.com/gap-insurance.html

Credit Life and Disability Income Insurance Childrens Life Insurance

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