Miss Smith 7 th Grade Civics *pgs

 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 risk  Claims are paid from the reserve fund  Private insurance- voluntary insurance that individuals and companies pay to cover unexpected losses  Ex: life insurance, health insurance, property insurance

 Provides 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

 Covers 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

 Protects personal property from fires, hurricanes, vandalism, theft, etc.

 Social insurance- government programs that protect individuals from future hardship  Social Security- system of social insurance set up in 1935

 A percentage of people’s salaries goes into a fund  After 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

 For workers who lost their job for reasons beyond their control

 Helps workers who have job related injuries or illnesses  Pays the medical expenses  Replaces lost income  Compensates survivors of workers killed on the job

 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