Personal Finance - Insurance

When considering disability plans, look for a plan that covers ____________ of your income.

65%

Which of the following should be covered by renter's insurance?

A flood occurs and damages all your furniture

What does having 80/20 coverage mean?

After a deductible has been paid, insurance pays 80% and you pay 20%

Which of the following is true?

Any kind of duplicate insurance coverage is a bad idea.

The recipient of assets passed on from the death of a friend or relative

Beneficiary

Which of the following policies would be a duplicate coverage for your health insurance policy?

Cancer and hospital indemnity insurance

Which of the following statements about life insurance is true?

Cash value insurance is normally for life and is more expensive than term life insurance because it funds a savings plan.

Paperwork filed with an insurance company in order to get them to cover a loss for someone they insure

Claim

An amount of money you pay to help cover a portion of your medical costs

Co-payment

Applies to the amount of protection you have through an insurance company in the event of a loss

Coverage

Amount you must pay before you begin receiving any benefits from your insurance company

Deductable

___________ insurance is designed to replace income that is lost due to short-term or long-term disability.

Disability

Which of the following statements about disability insurance is false?

Disability insurance is not necessary if you have a good health insurance policy.

Which of the following is not a recommended way of lowering your car insurance premiums?

Drop your auto insurance altogether

Which of these options is NOT a type of insurance?

Educational

The time between the disabling event and the beginning of payments in your disability coverage is called:

Elimination period

Insurance companies often use your ______________ to convince you to buy.

Emotions

After high school, you should have the following types of insurance: auto, renter's, health and long- term care insurance

False

Disability insurance offered through your employer is usually the most expensive coverage option.

False

Health insurance is optional.

False

If you are over 45 years old, you should get long-term care insurance.

False

If you're renting a house or apartment, you only need renter's insurance for the first few months.

False

It is cheaper to buy long-term disability insurance from the open market than from your employer.

False

It's a good idea to decrease your maximum pay.

False

Life insurance is a permanent need.

False

Life insurance is designed to pay off all your debt at the time of your death.

False

Pre-paid burial policies are a great purchase for any adult.

False

Prepaid burial policies are a good idea.

False

Renter's insurance is not necessary if you don't have a lot of expensive things.

False

You might consider dropping liability on your insurance coverage.

False

Moving assets into your name so that the government will pay for your aging parent's care is a _________ ______________.

Federal crime

Homeowner's coverage should include ________________ replacement cost.

Guaranteed

Which of the following is not a recommended way to save on your health insurance premium?

If you are young and healthy, you do not need health insurance.

To save money on your health insurance, you need to ____________ your deductible.

Increase

When shopping for insurance, use a(n) __________________ agent who shops a bunch of different companies to find the best rate for you.

Independent

Insurance that covers property damage and medical bills if you are at fault in a car accident or if someone gets hurt on your property

Liability

You are involved in a two-car accident in which you are at fault. The other driver is injured and your insurance covers the medical expenses of the victim. This type of insurance coverage is called:

Liability

Which of the following types of insurance is not recommended for a young single adult?

Life insurance

You can keep car insurance rates low by:

Not filing claims for smaller repairs, instead pay cash

Specific amount of money that you pay when insurance only covers a portion of costs

Out-of-pocket expense

Describes the type of coverage in an insurance agreement

Policy

The amount you pay monthly, quarterly, semiannually or annually to purchase different types of insurance

Premium

One way to keep your car insurance rate low is to __________ your deductible.

Raise

When buying identity theft protection, make sure it includes ___________ services.

Restoration

The purpose of insurance is to transfer ____________________.

Risk

Life insurance policy for a specific period of time is called:

Term

__________ life insurance is for a specific time period and is the cheapest way to buy life insurance.

Term

What is the most expensive time of your life?

The last 6 months

A person becomes self-insured when:

Their kids are grown, they have no debt, and they have fully funded retirement

The purpose of insurance is to:

Transfer financial risk

Any insurance with cash value or that combines insurance with investments is a bad idea.

True

Comprehensive coverage takes care of damage to your car that is not caused by a collision.

True

Duplicate coverage, or any extra insurance on top of your existing insurance, is not necessary.

True

Following the Five Foundations will help you to, one day, become self-insured.

True

Good identity theft protection includes restoration services.

True

Identity theft is the fastest growing white-collar crime today.

True

If you don't understand it, don't buy it.

True

If you have a fully funded emergency fund, you might consider increasing your stop-loss.

True

If your plan coverage includes an extended replacement cost, you need to update your plan at least once per year.

True

In order to decide if you should raise your deductible, you should find out how long it will take to break even.

True

Long-term care insurance covers nursing homes, assisted living, and sometimes in-home care.

True

Nearly 60% of workers in the US have health insurance through their employers.

True

Taking a driver's education course can save you money on car insurance.

True

There are scams and gimmicks in the insurance world.

True

You have a 1 in 3 chance of becoming disabled for 6 months or more at some point in your life.

True

You should not buy identity theft protection that only provides credit report monitoring.

True

_______________ policies are a really good buy because they add extra protection to your home and automobile insurance.

Umbrella

Which of the following plans include a savings plan as a part of the insurance?

Whole Life Universal Life Variable Universal Life *All of the above*

A legally enforceable declaration of how a person wishes his or her property to be distributed after death

Will

Which of the following would not be a huge financial risk (and, therefore would not require insurance) if you had a full emergency fund of $500 or more?

You lose your cell phone

Which of the following is not a benefit of having a will?

You only need a will if you have a large estate.

Which of the following statements about long-term care insurance is false?

You should not buy long-term care insurance until age 30.

Where can your identity be stolen?

Your mailbox The internet Your cell phone *All of the above*