Banks and Insurance What you should know…

What is a bank? A bank is a business that deals in money and credit. Banks safeguard deposits made by customers and make loans in the form of checks or credit.

4 types of banks –Commercial- most common. Offers full range of services. –Saving and Loan Assoc.- Specialize in home loans. –Savings Bank- Encourage small, frequent deposits. –Credit Union- Owned and operated by their members. Create a pool of $ for low interest loans.

What about insurance? Insurance is a system of paying a small amount to avoid the risk of a large loss. Insurance is based on the principal that life is full of risks and uncertainties.

Types of insurance Private Insurance: Voluntary, individuals and companies choose whether to pay for it or not. Life insurance Disability Liability Social Insurance: Gov’t programs that are meant to protect individuals form future hardships. Social Security Unemployment Old Age Disability

Social Security Three Parts: –Old Age, survivors and disability insurance: Pay a percentage each month –Unemployment insurance –Worker’s compensation

Social Security:Medicaid and Medicare Great Society Medicaid: Gov’t funded health care for poor people. Disabled and cannot work Medicare: Gov’t funded health care for people over the age of 65