Flashcards
Key terms Chapter 20 Life, Fire, and Auto Insurance
Cards in this deck (32)
- 1BeneficiaryPerson(s) designated to receive the face value of the life insurance when insured dies
- 2Bodily InjuryAuto Insurance that pays the damages to people injured or killed by your auto
- 3Cash ValueExcept for term insurance, this indicates the value of the policy when terminated. Options fall under the heading of nonforfeiture values
- 4CoinsuranceType of fire insurance in which the insurer and insured share the risk: Usually there is an 80% coinsurance clause
- 5CollisionOptional auto insurance that pays for the repairs to your auto from an accident after deductible is met. Insurance company will only pay for repairs up to the value of the auto
- 6Comprehensive InsuranceOptional auto insurance that pays or the damages to the auto caused by factors other than from collision (fire, vandalism, theft, and the like)
- 7Compulsory InsuranceInsurance required by law-standard coverage
- 8DeductibleAmounts deducted from gross earnings to arrive at net pay
- 9Extended Term InsuranceResulting from nonforfeiture, it keeps the policy for the full face value going without furth premium payments for a specific period of time
- 10Face AmountDollar amount stated in policy
- 11Face ValueAmount of insurance that is stated on the policy. It is usually the maximum amount for which the insurance company is liable
- 12Fire InsuranceStipulated percent (normally 80%) of value that is required for insurance company to pay to reimburse one's losses
- 13IndemnityInsurance company's payment to insured for loss
- 14InsuredCustomer or policyholder
- 15InsurerThe insurance company that issues the policy
- 16Level Premium TermInsurance premium that is fixed, say, for 50 years
- 17Liability InsuranceInsurance for bodily injury to others and damages to someone else's property
- 18No-Fault InsuranceInvolves bodily injury. Damage (before a certain level) that is paid by an insurance company no matter who is to blame
- 19Nonforfeiture InsuranceWhen a life insurance policy is terminated (expect term), it represents 1. the available cash value, 2. additional extended term, or 3. additional paid-up insurance
- 20Paid-up InsuranceA certain level of insurance can continue, although the premiums are terminated. This results from the nonforfeiture value (except term). Result is a reduced paid-up policy until death
- 21Policy HolderThe insured
- 22PremiumPeriodic payments that one makes for various kinds of insurance protection
- 23Property DamageAuto insurance covering damages that are caused to the property of others
- 24Reduced Paid up InsuranceInsurance that uses cash value to buy protection, face amount is less than original policy, and policy continues for life
- 25Short-Rate TableFire insurance rate table used when insured cancels the policy
- 26StatisticianA person who is skilled at compiling statistics
- 27Straight Life InsuranceProtection (full value of policy) results from continual payment of premiums by insured. Until death or retirement, nonforfeiture values exist for straight life
- 28Term InsuranceInexpensive life insurance that provides protection for a specific period of time. No nonforfeiture values exist for term
- 2920 Payment LifeProvides permanent protection and cash value, but insured pays premiums for the first 20 years
- 3020 Year EndowmentMost expensive life insurance policy. It is a a combination of term insurance and cash value
- 31Universal LifeWhole life insurance plan with flexible premium and death benefits. This life plan has limited guarantees
- 32Whole LifeProtection (full value of policy) results from continual payment of premiums by insured. Until death or retirement, nonforfeiture values exist for straight life
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- Key terms for Chapter 20 Life, Fire, and Auto Insurance
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- Kyra Louthan
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