INSURANCE AGAINST HARDSHIPMiss Smith

7th Grade Civics

*pgs. 522-526

INSURANCE PROTECTS YOU Insurance- system of spreading risks over large numbers of people People pay a small amount to the company to avoid the risk of a large loss

Premium- small amount paid for protection against riskClaims are paid from the reserve fundPrivate insurance- voluntary insurance that individuals and companies pay to cover unexpected losses Ex: life insurance, health insurance, property insurance

LIFE INSURANCEProvides the policy holder’s family with money when they die

Beneficiary- person named in a life insurance policy who receives the money if the policy holder dies

Term insurance- covers you during a specific time

Whole-life insurance- covers you throughout your life

DISABILITY AND HEALTH INSURANCECovers policy holders if the are injured in an accident or suffer an illness

Disability insurance pays lost wages if the policyholder cannot work due to partial disability

Health insurance covers medical and/or hospital expenses

PROPERTY AND LIABILITY INSURANCEProtects personal property from fires, hurricanes, vandalism, theft, etc.

INSURANCE PROVIDED BY THE GOVERNMENTSocial insurance- government programs that protect individuals from future hardship

Social Security- system of social insurance set up in 1935

OLD-AGE, SURVIVORS, AND DISABILITY INSURANCEA percentage of people’s salaries goes into a fundAfter workers retire or if they become disabled and cannot work, they get paid from the fund

If a worker dies before they reach retirement age, their surviving children aged 18 and under and surviving spouse receive their payments

UNEMPLOYMENT COMPENSATIONFor workers who lost their job for reasons beyond their control

WORKERS’ COMPENSATIONHelps workers who have job related injuries or illnesses

Pays the medical expensesReplaces lost incomeCompensates survivors of workers killed on the job

MEDICARE AND MEDICAID

Medicare- health insurance program for U.S. citizens ages 65 and older

Medicaid- health insurance program that provides money to help states pay medical costs of people with low incomes