Insurance Basics Flashcard

Front

How do insurance companies make payments more affordable for the insured?

Back

By pooling clients' risks

Front

What is a premium in the context of insurance?

Back

A payment made to an insurance company

Front

What does an insurance policy protect against?

Back

The risk of financial loss

Front

Which strategy involves acknowledging that people will get sick or accidents will happen?

Back

Acceptance

Front

How are different insurance needs determined?

Back

They are tied to each person's unique situation

Front

What is a premium in the context of insurance?

Back

The amount you pay for your insurance policy, usually monthly.

Front

What is the relationship between premiums and deductibles?

Back

Higher premiums result in lower deductibles.

Front

What is a copay in the context of health insurance?

Back

A dollar amount required when you visit a doctor.

Front

What is the primary purpose of homeowner's insurance?

Back

To provide liability coverage against accidents in the home

Front

What is the primary purpose of disability insurance?

Back

To replace a portion of your income if you are unable to work due to illness or injury