Health, Disability and Life Insurance

Costs of going to the hospitalCost of having a child?

$4000 - $11,000Ambulance Ride

$500 - $1000Average cost of someone staying in the

hospital…$21,000

Average cost of paying medical insurance without help of job.$370 per month or about $4500 per year.

Family of 4 almost $13,000 per year.

Type of health insuranceGroup Health

Many employees are grouped under the same plan so cost is fairly low.

Individual Health PlansSelf-employed people have these, not covered

under a group plan. Can meet special needs.

COBRAConsolidated Omnibus Budget Reconciliation Act

If an employee looses their job they are covered for a set period of time.

Usually private companies or state or local government are eligible for these benefits.

Basic Health CoverageHospital Expenses

Pay for some or all of the costs of room and board during the hospital stay. Routine nursing care, minor medical supplies. Usually have a number of set days that the policy will cover. Usually also a deductable.

Surgical ExpensesCovers all or part of the surgical fees for an operations. Policies have a list of the total amount that the policy will

cover and you have to pay the rest.For example a appendectomy may be $1000 and your

policy only covers $500 so you have to pay $500

PhyPhysician Expenses

Meets some or all of the costs of a physician care that do not involve surgery.

Physician expense coverage is usually combined with surgical and hospital coverage in a basic health insurance package.

Major medical expense insurance.Coinsurance – is the percentage of the

medical expenses the policyholder must pay in addition to the deductible amounts. Usually 20% to 25% of expense after they have

paid the deductible.

Dental Expense InsuranceCovers many different types of surgical, and

examinations for the mouth.Does not usually cover alternative surgeries.

Teeth whitening ex….

Section 14.2

Terms that you hear everyday….HMOPPOBlue Cross/Blue ShieldMedicaidMedicare

P.P.O.

Health Insurance Companies

Government Health Care ProgramsMedicareMedicade

Disability Insurance

Disability Income InsuranceProvides regular cash income when an

employee is unable to work due to pregnancy, a non-work-related accident or an illness.

Sources of Disability IncomeWorker’s Compensation

If your disability is a result of an accident or illness on the job.

EmployerProvided through group health plans

Social SecurityIf you pay social security, then you are eligible for social

security benefits.Very strict qualifications, but last as long as you need it.

Personal plansPay as much as 60-75%

Purpose of life insurancePay off a home

mortgage or other debts at the time of death

Provide lump-sum payments as a n endowment for children when they reach a certain age

Provide an education or income for children

Accumulate savingsEstablish a regular

income for survivorsSet up an estate

planPay estate and death

taxes

Age Both Sexes

Male Female

Age Both Sexes

Male Female

0 76.9 74.1 79.5 45 34.4 32.2 36.3

1 76.4 73.7 79 50 30.0 27.9 31.8

5 72.5 69.8 75.1 55 25.7 23.8 27.4

10 67.6 64.9 70.1 60 216 19.9 23.1

15 62.6 59.9 65.2 65 17.9 16.3 19.2

20 57.8 55.2 60.3 70 14.4 13.0 15.5

25 53.1 50.6 55.4 75 11.3 10.1 12.1

30 48.3 45.9 50.6 80 8.6 7.6 9.1

35 43.6 41.3 45.8 85 6.3 5.6 6.7

40 38.9 36.7 41.0

Types of Life Insurance policiesTerm Life insurance

Also called temporary life insurance – is insurance that provides protection against loss of life for only a specified term or period of time.

Could be for 1,5,10, or 20 years or even up to the age of 70.

If you stop paying your coverage stops. Used mostly when raising children so that in

case something happens to you, there is money to help raise the children.

Provisions to lifeProvision – is what things can the company

has to make sure that they do not pay the premiums that you pay.Beneficiary designation - if your beneficiary

passes with you and you do not change it no one gets the money.

Incontestability clause – if the company was to go under bankrupt then the policyholder is still covered.

Suicide clause - only receives the amount that the policy holder pays in premiums.

Last couple of slidesRiders to Life insurance

Waiver of premiums for disability – if you have a disability you can say that you will take care of the disability out of pocket to keep premiums lower.

Accidental Death Benefit – Double indemnity – meaning the policy will pay double if the policyholder was killed in accident.

Guaranteed insurability Pre-Existing Condition.