Insurance Jeopardy®
Joan Koonce, Ph.D., AFC®
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 homeowner’s
insurance to cover your home, this is
uninsurable.
What is land?
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Property & Liability - 400
You add these to your standard
homeowner’s 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 don’t 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 vehicle’s 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: Don’t 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
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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
• Homeowner’s 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
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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
• Worker’s 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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Homeowner’s Insurance Terms
• Replacement Cost/Value: the amount
necessary to repair, rebuild or replace an
asset at today’s 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 Homeowner’s
Insurance
• Basic Forms of Homeowner’s Insurance
– Broad Form Homeowner’s Insurance
– Special Form Homeowner’s Insurance
– Renter’s Insurance
– Condominium Owner’s Insurance
– Older Homes Homeowner’s 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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Homeowner’s 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 homeowner’s 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
• Children’s Life Insurance
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www.gafamilies.com
1-800-ASK-UGA1