Enterprise: Management Job: Using Insurance to reduce risk

1. Enterprise: ManagementJob: Using Insurance to reduce risk Original PowerPoint Created byJoel Wondra Modified by Georgia Agricultural Education Curriculum OfficeJune, 2002

2. Objective Learn what insurance is and determine what insurance you need.

3. What is insurance and why is it important to you? Insurance is a method of managing risk and uncertainty.

4. What are the two reasons to buy life insurance? • The first reason to buy insurance is to provide protection against the loss of income due to the premature death of the breadwinner. • The second reason is to provide a means of savings and investment.

5. Explain the difference between term, straight, limited payment and endowment life insurance:

6. Term Term is the purest form of insurance. You pay for the insurance and, as long as you are paying, you have insurance.

7. Straight Life (whole) insurer pays a fixed price for insurance usually higher at first than term but does provide some savings

8. Limited Payment similar to straight yet payments are higher Then the interest earned on the premiums kicks in and starts paying the premiums. There is even more savings.

9. Endowment policy in which when you finish paying over a number of years you can cash the policy in for the face value. Costs the most.

10. What are the functions of health insurance? a. protect against the financial hardship due to illness or injury b. covers cost of medical care to insure competent treatment c. protects creditors by insuring policy holders ability to repay debt

11. What are the four areas that health insurance covers: • hospital expense • surgical expense • Regular • major medical

12. Hospital Expense covers hospital room and board

13. Surgical Expense pays for all or part of surgical fees

14. Regular pays for doctors visits

15. Major Medical provides coverage for large medical expenses

16. What does property insurance cover? Property insurance insures against loss due to fire, hail and wind storms. Can get extra coverage for riots, civil commotion, vehicles, and smoke.

17. Who administers crop insurance and what does it cover? A special division of the USDA administers crop insurance. This insurance covers crop loss regardless of cause and will also cover decreased quality. This is a management tool that farmers need to consider.

18. Types of auto insurance: a. liability b. medical payment c. uninsured motorist d. collision e. comprehensive f. ad&d

19. Liability this insurance pays for bodily injury and damage to others when insurer is responsible

20. Medical Payment pays of insured and passengers medical fees regardless of blame.

21. Uninsured Motorist covers insured, spouse and children if struck by uninsured

22. Collision pays damage to insured’s care if it hits another vehicle or object.

23. Comprehensive covers loss caused by fire wind, theft, vandalism, collision with animal, etc.

24. ad&d pays a lump sum for death in car accident also pays lump sum for loss of limb, blindness, and such.

25. Insurance companies use the following to figure premiums: a. age < 25 b. location of vehicle c. protection desired d. accident history e. use of vehicle

26. List and explain the two types of insurance companies. • stock • mutual

27. Stock protects customer and stockholders profit

28. Mutual policy holders are the owners can profit, but might also have to pay extra if losing money

29. From who else can we get insurance? • agricultural organizations • the government

30. Comprehensive personal liability insurance based on: • number of employees • type of work

31. Workman's compensation benefits • medical expenses • hospital service • pay to the employee. • This insurance will pay up to 401 weeks and provides the spouse with payment for life if death occurs. • This insurance is not mandatory