1. Insurance against Hardship
Miss Smith
7th Grade Civics
*pgs

2. 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 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

3. Life 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

4. Disability and Health Insurance
Covers policy holders if they 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

5. Property and Liability Insurance
Protects personal property from fires, hurricanes, vandalism, theft, etc.

6. Insurance Provided by the Government
Social insurance- government programs that protect individuals from future hardship
Social Security- system of social insurance set up in 1935

7. Old-Age, Survivors, and Disability Insurance
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

8. Unemployment Compensation
For workers who lost their job for reasons beyond their control

9. Workers’ Compensation
Helps workers who have job related injuries or illnesses
Pays the medical expenses
Replaces lost income
Compensates survivors of workers killed on the job

10. 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