personal finance test 2 (chapter 9)

so sophisticated high malpractice costs no incentive to economize

3 reasons why health care is so expensive

HEALTH INSURANCE DECISION TREE

HEALTH INSURANCE DECISION TREE

WHAT IS CURRENTLY GOING ON WITH OBAMACARE

LOOK AT NOTES

group life term

Sally Heath has the option of obtaining life insurance through her place of employment. She will not need to take a physical exam. This type of policy would be​ a/an ________ policy.

false

T/F with COBRA coverage, the employer pays the premiums

settlement options

The alternative ways that a beneficiary can choose to receive the policy benefits upon the death of the insured are called

30 days

The coverage grace period gives you an extension of generally​ ________ in which to make your premium payment without canceling your policy.

2 years

The incontestability clause states that the insurance company cannot dispute the validity of the contract after a specified period of​ time, usually ____________________________

grace period

The policy feature that allows you to pay the premium late but still retain coverage is known as the

loan clause

a clause that provides the right to borrow against the cash value of the policy at a guaranteed interest rate

whole life insurance

cash value insurance that provides permenant coverage and a death benefit when the insured dies. if the person turns 100, the benefit is payed out even if the person has not died

payment premium clause

defines how you will pay your premium payments. annual payments are usually the cheapest

cleanup funds

funds needed to cover immediate expenses at the time of your death

non forfeiture right

gives the policyholder the cash value of the policy in exchange for the policyholder giving up his or her right to a death benefit.

change of policy clause

gives the policyholder the right to change the form of the policy

transferring you insurance company

health insurance is about _________________ risk from __________________ to the __________________________

term insurance

insurance that pays the beneficiary a specific amount of money if the policy holder dies while covered by the policy

earnings multiple approach

method od determining how much life insurance you need by using a multiple of your yearly earnings

needs approach

method of determining how much life insurance you need based on funds your family would require to maintain their lifestyle should you die

policy reinstatement clause

policy that gives right to restore a policy to its full effect 3-5 years after the policy has expired

risk pooling

sharing financial consequences associated with risk in the insurance industry

beneficiary

the individual designated to receive the insurance policy proceeds upon the death of the insured

incontestability clause

the insurance company cannot dispute the validity of the contract after a specified period of time, usually 2 years

suicide clause

the insurance company wont pay off for suicide deaths that occur within the first two years of the contract

coverage grace period

the late payment method for premium during which the policy stays in effect and no interest is charged. if payments arent made, the policy can be cancelled after the grace period

insured

the person whose life is insured by the life insurance policy

affordable care act

was put in place to help provide health coverage for the millions of americans that do not have health insurance. with this in place 95% of americans will have health care