Insurance Basics Review

Front

What is the payment made to an insurance company for coverage?

Back

Premium

Front

The amount a person must pay out-of-pocket before an insurance policy begins covering expenses is called the:

Back

Annual deductible

Front

Which term describes the fee paid to a lender in exchange for borrowing money? Options: Principal, Premium, Finance charge, Loan balance

Back

Finance charge

Front

If an insurance company considers a policyholder high-risk, how does it affect their premium?

Back

The premium increases

Front

A person paying $400 per year for their renter’s insurance is covering their:

Back

Premium

Front

Which type of life insurance is usually less expensive and provides coverage for a specific time period?

Back

Term life insurance

Front

What is the key difference between term life and whole life insurance?

Back

Term life lasts for a specific period, while whole life lasts a lifetime.

Front

Which of the following types of insurance accumulates cash value over time? A. Term life insurance, B. Whole life insurance, C. Auto insurance, D. Health insurance

Back

Whole life insurance

Front

An auto insurance collision policy covers:

Back

damage to your car from a collision with another vehicle or object

Front

If a health insurance policy includes a $500 deductible, what does this mean?

Back

The person must pay the first $500 of medical expenses each year.