Application 8C - 8G pg. 26 - 31

Question 1

Describe an extended warranty

Answer 1

> consumers buying certain products such as automobiles, electronics, and appliances may be asked by the salesperson to buy an extended warranty on the item
The sales pitch explains how expensive it will be to repair or replace a phone if it breaks or how much it will cost if the transmission of a car malfunctions after the manufacturer’s warranty expires

Question 2

Define collateral

Answer 2

collateral - something of value that the lender can claim in the event of non-payment of the loan

Question 3

Define foreclosure

Answer 3

foreclosure - the bank sells the home to recover the balance of the mortgage

Question 4

Define premium

Answer 4

premium - the amount one pays for the policy

Question 5

Define deductible

Answer 5

deductible - amount the insured must pay each year before the insurance company begins to pay its share on a claim

Question 6

Define copay

Answer 6

copay - when the individual pays a small portion of the cost of the visit

Question 7

Describe preventative care

Answer 7

In an effort to keep costs low, most health insurance companies pay the cost of preventative care in addition to covering injuries and illnesses.
>visits for yearly physicals as well as preventative care such as screenings for different cancers at various ages are often covered.
>this benefit has proven effective in reducing claims for major health issues that would otherwise go unnoticed until significant care is needed