Personal Finance Unit 7.1 Vocabulary Flashcards
Protection against possible financial loss.
Insurance
The fee a policyholder pays an insurance company for the actual insurance
Premium
The chance of loss or injury
Risk
Anything that may possibly cause a loss, such as a tornado, hurricane, etc…
Peril
Something that makes it more likely for a loss to occur, defective electrical wiring is an example.
Hazard
Coverage that provides protection for your residence.
Homeowners Insurance
A method of insuring in which the amount you receive is based on the cost of an item minus depreciation.
Actual Cash Value
Insurance that covers damage to your vehicle if it’s involved in an accident
Collision
An insurance system in which each party in the accident collects from their own insurance company
No-Fault System
A system that provides high cost insurance for those who otherwise cannot get it due to past accidents.
Assigned Risk Pool
