Module 8 Flashcards
Disability Insurance
Protects against the risk of a serious illness or accident that would render the insured incapable of self care or of full employment. Important because over 50% of disabilities over a year. Should be 60 to 80% of gross income
Critical illness insurance
Either pays a lump sum or provides income if diagnossed with a critical illness. The policy will pay out even if you subsequently make a full recovery and you have full discertion over how to use the money
Long term care insurance
th insured pays a lump sum or continuing premium and the insurance pays all or some of the cost of long term care. They are 3 types of long term care insurance
3 types of long term care insurance plan
1) Income plan
2) Reimbursement
3) Indemnity plan
Income plan (long term care insurance)
Predetermined weekly benefit which you are free to use for whatever long term care service you wish
Rembursement (long term care insurance)
Must submit proof that you received care covered under the plan
Indemnity Plan (Long term care insurance)
Receives a predetermined daily benefit if you can prove you received covered service
Property insurance
Insures physical property against damage theft or destruction
Home insurance
Protects the family against the risk of loss, damage or destruction of the home, its related out buildings and its content. It also coveres liability to a third party for injury suffered on the property. There is no standard insurance policy
What are the 2 types of valuation of home content (insurance)
- Depreciated Value
- Replacement Value
Depreciated Value ( home valuation)
The item is valued at replacement or repare of the item in the condition it was when it was lost or damaged
Replacement Value (Home valuation)
The cost of buying a new item of the same quality. If the insured wishes not to replace at depreciated value only
Replacement value of the home
It is the home structure which is everythins except land and fondations. Some insurance company set the amount of the mortgage = the home insurance
80% rule ( home insurance)
Most insurance will not cover full loss on partial damage unless the insured has bought anough insurance to cover at least 80% of the home’s replacement value
Infaltion protection provision (home insurance)
Automaticaly increase the coverage each year in accordance to an inflation index