Auto and Renters insurance: Liability: the amount that you may be required to pay someone for damages that you caused Managing riskAvoiding: do not own any assets, while diving don’t text. Reduce: limit dollar value of assets, accept: dont have control over adverse events. Insure: Premium- cost of obtaining insurance. Most popular types of insurance: Property, casualty, life, and health. Auto insurance: 100/300/50. 100,000 per person injured in accident. 300,000 for all people combined, 50,000 for property damage. Deductible (self-insurance): a set dollar amount that you are responsible for paying before any coverage is provided by your insurer. Must pay first. Health and disability insurance: Health insurance—> Long term care—> disability insurance Private insurance: indemnity plan: expensive, can see anyone. managed care-HMOs low premium primary care has to refer to specialists. managed care- PPOs higher than HMO but low, in between indemnity and HMO. Government insurance: medicare- provides health insurance to people over 65. Parts A-D Medicaid-a federal program that provides health care to the aged, blind, disabled, and needy families with dependent children. C Health care insurance- COBRA law: stays under coverage for 18 months after fire HIPAA- prohibits insurance companies from denying health insurance coverage based on an applicant’s health status, medical history, previous claims, or disability Major medical- a policy you can buy to rest on top of other health insurance to cover a major expense. Affordable care act- stay under parents' insurance till 26 Long-term care- covers activities of daily living. Premiums higher when old Disability- insurance that provides income to policyholders in the event that they become disabled. OWN occupation def- most liberal. Any occupation- most restrictive Life insurance- rule of thumb- 10 factor- income*10. 100,000*10= 1,000,000 ignore debt. Term vs whole life: Term- covers a certain period of your life. Goes up the older you get Whole life- covers your entire life. Fixed premium for your whole life.

Exam 2 Personal Finance Notes

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