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Terms Used When Setting Up Coverage                                                                Health Insurance

          „ Insured - the person who is covered                                                                          Health insurance is usually available from your employer as a benefit, or you can
          „ Insurance Agent – the representative of the insurance company who sells you the insurance and                purchase it yourself from an agent. Health insurance is expensive, and there are many
          provides support                                                                                               rules and regulations on what is covered and not covered. There are two main types of
                                                                                                                         health insurance:
          „ Policy – the contract that indicates the details of the insurance coverage
                                                                                                          Fee-for-Service (or Indemnity) Plans – You pay your deductible and then the insurance company will
          „ Coverage – what the insurance company will pay for                                            pay a percent of any bills (usually 80%) while you pay 20%. There are few restrictions on this plan, but
          „ Exclusions - situations the insurance will not cover                                          it is expensive and many employer don’t offer it.

          „ Coverage limits – specifies the maximum amount the company will pay on an incident            Managed Care Plans – Features medical care within a network of physicians. Based on the plan,
          „ Premium –the amount you pay for your coverage                                                 you may be restricted to seeing only health care providers in the network, or you may pay more of the
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          „ Deductible - a portion of the damages you agree to pay first before the insurance company begins to   expense or all of the expense of seeing someone outside the network. You pay a certain price for a range
                                                                                                          of services. There is no deductible or a lower deductible, and you pay a small fee (copay) for office visits
          pay. The higher the deductible, the lower your premium.
                                                                                                          and procedures. Managed care is much more affordable, but there are many restrictions on services
                                                                                                          and providers. Examples of managed care plans include Health Maintenance Organizations (HMO),
     Life Insurance                                                                                       Preferred Provider Organization (PPO), and Point of Service (POS).

     Life insurance is designed to replace your income and pay for expenses your family                   How Do You Qualify? Employers generally offer health insurance after you have been employed for
                            For Evaluation Only
     will have if you die. If you’re single with no dependents, you probably don’t need life              a certain time. There is generally no physical exam required, but you will need to give them some
     insurance right now. If you have a family and children, it can provide security, knowing             background about your health.
     they are protected.                                                                                  Pre-existing Conditions: This is a medical condition you already have when you get insurance. If you

     How much do you need? – Think about what you need now, and what expenses you would want to pay. You   currently have health insurance and you get new insurance, the pre-existing condition will be covered. If
     would want to replace lost salary, pay off your home mortgage, pay for your children’s education, and any   you didn’t have health insurance before, the pre-existing condition will probably not be covered for up to
     additional expenses you think your family might have. What additional expenses would there be? Add up the   a year.
     costs and figure out how your family would need each year.                                           Exercise:          Do I need this insurance?  Y N  Estimated Cost:
     Types of Life Insurance - The two most common types are:

       Term Life – You pay a premium for a set time period. As long as you continue to pay, you are covered. This is   What types of medical care do I
       the most affordable option.                                                                        want covered?

       Whole Life – You are covered for your entire life as long as your premium is paid. It is more expensive and is a   What coverage does my family
       combination of insurance and savings investment. Two additional types include Universal Life, and Variable   need?
       Life which are similar to whole life but have may more options and different restrictions on the investment
       side.                                                                                                                     When You Need to Use the Insurance

       Exercise:          Do I need this insurance?  Y N  How much do you need?                            „ Liability – any money you are legally obliged to pay to someone else
                                                                                                             „ Loss – the money needed to repair or replace an item
       What expenses do you want
       covered?                                                                                              „ Claim – you ask the insurance company to pay for an expense
                                                                                                             „ Claims adjuster –person from the insurance company who inspects the damage and determines how
       What coverage does my family                                                                          much the insurance company will pay on a claim.
       need?
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