Prepared By Johnny Howard 2015 South Western, A Part Of Ceng

Prepared By Johnny Howard 2015 South Western A Part Of Cengage Lear

Prepared by Johnny Howard © 2015 South-Western, a part of Cengage Learning, covers various insurance types, including auto, property, life, and medical insurance. It explains key concepts such as auto liability, comprehensive, collision insurance, deductibles, no-fault insurance, low- and high-risk drivers, property loss calculations under coinsurance, different life insurance policies like term, straight life, endowment, and annuities, as well as cash surrender and loan values. The document also discusses group medical insurance, health maintenance organizations (HMO), preferred provider organizations (PPO), and includes various chapter terms and assignment problems related to auto, property, life, and medical insurance coverage and calculations.

Paper For Above instruction

Insurance plays a vital role in safeguarding individuals, assets, and health through various comprehensive plans and policies. This paper explores the fundamental concepts, types, and calculations associated with auto, property, life, and medical insurance, emphasizing their importance in risk management and financial security.

Auto Insurance

Auto insurance is essential for protecting drivers against financial losses resulting from accidents, theft, or damage. The primary categories include auto liability and property damage insurance, auto comprehensive insurance, and auto collision insurance. Liability coverage compensates for injuries and damages caused to others, whereas comprehensive coverage protects against non-collision damages such as vandalism or natural disasters. Collision coverage specifically addresses damages resulting from crashes. The insurance premium is the cost paid periodically for coverage, and deductibles are the out-of-pocket amounts the insured pays before the insurer covers the rest.

Auto insurance policies also consider the risk profile of drivers. Low-risk drivers, with clean records, generally pay lower premiums, whereas high-risk drivers with prior citations or accidents face higher rates. No-fault insurance systems require drivers to carry their own protection, limiting the ability to sue for damages. Short rates are used when policies are canceled before their term expires, resulting in adjusted rates.

Property Insurance and Loss Calculations

Property insurance protects against damage or loss of assets like buildings or possessions. The calculation of the owner’s share of a property loss involves applying coinsurance clauses, which require policyholders to insure a percentage of the property's value. Recovery is limited to the lesser of the policy amount or the calculated recovery based on the actual loss, calculated using the coinsurance formula.

Life Insurance Policies

Life insurance serves to provide financial security to beneficiaries upon the insured’s death. Different policies include term insurance, which pays only if the insured dies during a specific period; straight (ordinary) life insurance, where premiums are paid annually until death; limited-payment policies, where premiums are fixed for a set period; endowment insurance, payable upon death within a specified term; and annuities, which provide steady income after a certain age until death.

Additional features like accidental death benefits (ADB) enhance policies, offering extra coverage for unforeseen events. Cash surrender values and loan values are features allowing policyholders to access cash or borrow against their policies. Cash surrender occurs when the policyholder ends the policy prematurely, receiving the surrender value, while loan values are the amounts accessible via policy loans.

Medical Insurance and Group Plans

Medical insurance, including group plans, offers coverage for health-related expenses. These plans often have lower premiums due to risk pooling. Health maintenance organizations (HMO) and preferred provider organizations (PPO) are common types of managed care plans that emphasize cost efficiency and network providers, reducing out-of-pocket costs for insured individuals.

Conclusion

Understanding the intricacies of various insurance policies enables individuals and organizations to make informed decisions and manage their risks effectively. Whether protecting assets through property insurance, securing financial stability via life insurance, or ensuring health coverage through medical plans, comprehensive knowledge enhances financial resilience and peace of mind.

References

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• Fitzgerald, P., & Smith, K. (2020). Principles of Insurance. McGraw-Hill Education.
• Rejda, G. S., & McNamara, M. J. (2021). Principles of Risk Management and Insurance. Pearson.
• Coker, P., & Hoskisson, R. E. (2018). Insurance Law and Practice. Aspen Publishers.
• National Association of Insurance Commissioners (NAIC). (2022). Understanding Insurance Policies. NAIC Publications.
• Stark, J. D. (2017). Property and Liability Insurance Principles. Delmar Cengage Learning.
• Pauly, M. V. (2019). Medical Insurance and Managed Care. Routledge.
• Elrod, C. C., & Nistad, M. (2021). Life Insurance and Annuities. Wiley.
• American Council of Life Insurers. (2020). Basics of Life Insurance Policies. ACLI Reports.
• Carroll, G., & McIntosh, A. (2018). Healthcare Economics and Insurance. Springer.