Homeowners Insurance

1. Homeowners Insurance

2. Homeowners Insurance • There is renters insurance and homeowners insurance. Both are for protecting your belongings • In insurance, your belongings are called “content” (as in “the content of your home”)

3. What if the house is a total loss? • Replacement Cost – the cost to rebuild your home the same as it was • Actual Cash Value – how much would your house sell for on the open market (also called Fair Market Value)

4. Health Insurance • Pays your medical bills • Your parents policy will cover you until the age of 26 • Can also include vision and dental

5. What you have to pay... • Deductible - This is what you pay before the insurance company pays anything • Co-Payment – this is what you pay to see the doctor. Usually ranges between $10 and $60 • Co-insurance – This is the part of the medical bill you pay after you pay the deductible (90/10, 80/20, 70/30)

6. For instance...... • You have to go to the hospital and incur a $5,000 bill. • Your deductible is $1,000 • Your co-insurance is 80/20, so that means that of the $4,000 left after the deductible, you owe $800 and the insurance company will pay $3,200

7. Life Insurance • Life insurance provides money to whomever you choose upon your death • Life insurance policies must have a Beneficiary (the person you want to receive the money)

8. Term Life • Usually the lowest cost option • Pays higher death benefits • Can only buy the policy for a limited term (time period), usually 10, 15, 20, or 30 years • When the term ends, you must purchase a new policy (usually at a higher rate) • Pays off only if you die

9. Whole Life • More expensive and lower death benefit than term • Provides coverage for your whole life, premiums never increase • Investment with a cash value that increases over time • You can borrow against the cash value

10. Disability Insurance • Pays you if you are unable to work due to injury or illness • AFLAC