Ch 11 & 12 Review
Tuesday, April 28, 2026 3:44 PM
Health, Disability & Long-Term Care Insurance
Health Care Costs
• Protection against financial loss from illness, accidents, disability
• Costs have increased A LOT over time (billions → trillions)
Why health care is expensive
• Expensive technology
• Multiple / repeated tests
• Aging population (more care needed)
• High admin costs (~11%)
• Fraud + waste
• Overuse of services (urgent care for small issues etc)
• Limited competition
What is being done about costs
• Preventative care programs
• Community health programs
• Fee reviews
• Alternative low-cost services
How YOU can reduce costs
• Use preventive care
• Ask for generic meds
• Use mail-order prescriptions
• Compare prices online
• Review medical bills for errors
• Consider high-deductible plans / FSA
Health Insurance Basics
• Financial protection for medical expenses
Types of Health Insurance
• Group insurance (through employer)
• Individual insurance (your own plan)
• Supplemental insurance (covers gaps)
Important Terms
Deductible
• amount YOU pay before insurance
Coinsurance
• you share costs after deductible
Copayment
• fixed fee per visit
Stop-Loss
• insurance pays 100% after limit
Coordination of Benefits (COB)
• combine multiple policies
Types of Coverage
• Hospital expense
• Surgical expense
• Physician expense
• Major medical (big injuries/illness)
• Dental insurance
• Vision insurance
• Hospital indemnity (cash payout only)
Long-Term Care (LTC)
• Covers daily care (elderly/disability)
• VERY expensive ($100k–$400k/year)
• Recommended for older adults (~60+)
Policy Provisions
Eligibility
• who qualifies
Benefit limits
• max amount paid
Exclusions
• what is NOT covered
Guaranteed renewable
• can’t cancel if you pay premiums
Types of Plans
HMO
• must use network
• cheaper
PPO
• more flexibility
• higher cost
EPO
• strict network
• no outside reimbursement
POS
• mix of HMO + PPO
Government Programs
Medicare (65+)
Part A → hospital
Part B → medical
Part C → advantage plans
Part D → prescriptions
Medicaid
• for low income individuals
ACA (Affordable Care Act)
• covers preexisting conditions
• stay on parents plan until 26
• preventive care = free
CH 12 – Life Insurance
Life Insurance (basic idea)
• contract where insurer pays money after death
• you pay premiums → they pay benefits
Purpose of Life Insurance
• pay debts (mortgage, loans)
• support family / dependents
• cover funeral/medical costs
• provide income for survivors
• savings / retirement
• estate planning
Who needs it
• if your death causes financial strain
• especially if you have spouse / kids
How much you need
Easy method
• income × 7 × 0.70
DINK method
• dual income no kids → lower need
Non-working spouse method
• estimate childcare costs
Family needs method
• full financial calculation
Types of Life Insurance
Term Life
• coverage for a set time
• cheapest option
Features
• renewable
• convertible (to whole life)
• decreasing term (payout goes down)
• return of premium (refund if you outlive)
Whole Life
• covers you for life
• builds cash value (savings)
Types
• limited payment (paid off early)
• modified (low → higher payments later)
• variable (based on investments)
• adjustable (flexible)
• universal (very flexible)
Other Policies
• group life (through employer)
• credit life (pays debt – not recommended)
• endowment (pays after set time)
Policy Provisions
Grace period
• 20–31 days to pay premium
Reinstatement
• restart canceled policy
Policy loan
• borrow from cash value
Guaranteed insurability
• add coverage later
Clauses
Nonforfeiture
• keep some benefits
Incontestability
• insurer can’t dispute after time
Suicide clause
• limited payout early
Beneficiary
• person who receives money
Payout Options
• lump sum
• installments
• life income (annuity)
Riders (add-ons)
• waiver of premium (disability)
• accidental death (double payout)
• cost-of-living (inflation protection)
• accelerated benefits (early payout if terminally ill)
Buying Life Insurance
• income now + future income
• savings
• other coverage
• company strength
Underwriting
• determines your premium
based on:
• age
• health
• job
• lifestyle
Got you—this is your 1-page cheat sheet, super condensed, clean, and made to memorize fast 👇
📄 FINANCE CH 11 & 12 – ONE PAGE CHEAT SHEET
CH 11 – HEALTH INSURANCE
Purpose
• Protects against medical costs (illness, accidents, disability)
Key Terms
• Deductible → you pay first
• Coinsurance → you share costs after
• Copay → fixed fee per visit
• Stop-loss → insurance pays 100% after limit
Types of Insurance
• Group → employer
• Individual → personal plan
• Supplemental → fills gaps
Types of Coverage
• Hospital
• Surgical
• Physician
• Major medical (big costs)
• Dental / Vision
• LTC (long-term care → VERY expensive)
Plans
• HMO → cheapest, strict network
• PPO → flexible, higher cost
• EPO → no outside coverage
• POS → mix
Government Programs
• Medicare → 65+ (A hospital, B medical, C advantage, D drugs)
• Medicaid → low income
• ACA → preexisting covered, free preventive care
Cost Control (TEST TIP)
• Preventive care
• Generic meds
• Compare prices
• Review bills
CH 12 – LIFE INSURANCE
Purpose
• Protects family financially after death
Basic Idea
• You pay premiums → insurer pays beneficiaries
Who Needs It
• Anyone with dependents / financial responsibilities
How Much (FORMULA)
• Income × 7 × 0.70
Types of Life Insurance
Term Life
• Temporary
• Cheapest
• No savings
Whole Life
• Lifetime coverage
• Builds cash value
Other Types
• Group life → job
• Credit life → pays debt (not recommended)
Key Features
Policy Stuff
• Grace period → extra time to pay
• Reinstatement → restart policy
• Policy loan → borrow from cash value
Clauses
• Incontestability → can’t dispute later
• Nonforfeiture → keep some value
Riders (ADD-ONS)
• Waiver of premium (disability)
• Accidental death (double payout)
• Cost-of-living (inflation)
• Accelerated benefits (early payout)
Payout Options
• Lump sum
• Installments
• Life income (annuity)
BIG TEST DIFFERENCES
• Health insurance = YOU (medical costs)
• Life insurance = YOUR FAMILY (after death)
• Term = cheap + temporary
• Whole = expensive + lifetime + savings
• Deductible vs Coinsurance = VERY important
If you want, I can hit you with a 10-question practice quiz that looks almost exactly like your exam 👀
Tuesday, April 28, 2026 3:44 PM
Health, Disability & Long-Term Care Insurance
Health Care Costs
• Protection against financial loss from illness, accidents, disability
• Costs have increased A LOT over time (billions → trillions)
Why health care is expensive
• Expensive technology
• Multiple / repeated tests
• Aging population (more care needed)
• High admin costs (~11%)
• Fraud + waste
• Overuse of services (urgent care for small issues etc)
• Limited competition
What is being done about costs
• Preventative care programs
• Community health programs
• Fee reviews
• Alternative low-cost services
How YOU can reduce costs
• Use preventive care
• Ask for generic meds
• Use mail-order prescriptions
• Compare prices online
• Review medical bills for errors
• Consider high-deductible plans / FSA
Health Insurance Basics
• Financial protection for medical expenses
Types of Health Insurance
• Group insurance (through employer)
• Individual insurance (your own plan)
• Supplemental insurance (covers gaps)
Important Terms
Deductible
• amount YOU pay before insurance
Coinsurance
• you share costs after deductible
Copayment
• fixed fee per visit
Stop-Loss
• insurance pays 100% after limit
Coordination of Benefits (COB)
• combine multiple policies
Types of Coverage
• Hospital expense
• Surgical expense
• Physician expense
• Major medical (big injuries/illness)
• Dental insurance
• Vision insurance
• Hospital indemnity (cash payout only)
Long-Term Care (LTC)
• Covers daily care (elderly/disability)
• VERY expensive ($100k–$400k/year)
• Recommended for older adults (~60+)
Policy Provisions
Eligibility
• who qualifies
Benefit limits
• max amount paid
Exclusions
• what is NOT covered
Guaranteed renewable
• can’t cancel if you pay premiums
Types of Plans
HMO
• must use network
• cheaper
PPO
• more flexibility
• higher cost
EPO
• strict network
• no outside reimbursement
POS
• mix of HMO + PPO
Government Programs
Medicare (65+)
Part A → hospital
Part B → medical
Part C → advantage plans
Part D → prescriptions
Medicaid
• for low income individuals
ACA (Affordable Care Act)
• covers preexisting conditions
• stay on parents plan until 26
• preventive care = free
CH 12 – Life Insurance
Life Insurance (basic idea)
• contract where insurer pays money after death
• you pay premiums → they pay benefits
Purpose of Life Insurance
• pay debts (mortgage, loans)
• support family / dependents
• cover funeral/medical costs
• provide income for survivors
• savings / retirement
• estate planning
Who needs it
• if your death causes financial strain
• especially if you have spouse / kids
How much you need
Easy method
• income × 7 × 0.70
DINK method
• dual income no kids → lower need
Non-working spouse method
• estimate childcare costs
Family needs method
• full financial calculation
Types of Life Insurance
Term Life
• coverage for a set time
• cheapest option
Features
• renewable
• convertible (to whole life)
• decreasing term (payout goes down)
• return of premium (refund if you outlive)
Whole Life
• covers you for life
• builds cash value (savings)
Types
• limited payment (paid off early)
• modified (low → higher payments later)
• variable (based on investments)
• adjustable (flexible)
• universal (very flexible)
Other Policies
• group life (through employer)
• credit life (pays debt – not recommended)
• endowment (pays after set time)
Policy Provisions
Grace period
• 20–31 days to pay premium
Reinstatement
• restart canceled policy
Policy loan
• borrow from cash value
Guaranteed insurability
• add coverage later
Clauses
Nonforfeiture
• keep some benefits
Incontestability
• insurer can’t dispute after time
Suicide clause
• limited payout early
Beneficiary
• person who receives money
Payout Options
• lump sum
• installments
• life income (annuity)
Riders (add-ons)
• waiver of premium (disability)
• accidental death (double payout)
• cost-of-living (inflation protection)
• accelerated benefits (early payout if terminally ill)
Buying Life Insurance
• income now + future income
• savings
• other coverage
• company strength
Underwriting
• determines your premium
based on:
• age
• health
• job
• lifestyle
Got you—this is your 1-page cheat sheet, super condensed, clean, and made to memorize fast 👇
📄 FINANCE CH 11 & 12 – ONE PAGE CHEAT SHEET
CH 11 – HEALTH INSURANCE
Purpose
• Protects against medical costs (illness, accidents, disability)
Key Terms
• Deductible → you pay first
• Coinsurance → you share costs after
• Copay → fixed fee per visit
• Stop-loss → insurance pays 100% after limit
Types of Insurance
• Group → employer
• Individual → personal plan
• Supplemental → fills gaps
Types of Coverage
• Hospital
• Surgical
• Physician
• Major medical (big costs)
• Dental / Vision
• LTC (long-term care → VERY expensive)
Plans
• HMO → cheapest, strict network
• PPO → flexible, higher cost
• EPO → no outside coverage
• POS → mix
Government Programs
• Medicare → 65+ (A hospital, B medical, C advantage, D drugs)
• Medicaid → low income
• ACA → preexisting covered, free preventive care
Cost Control (TEST TIP)
• Preventive care
• Generic meds
• Compare prices
• Review bills
CH 12 – LIFE INSURANCE
Purpose
• Protects family financially after death
Basic Idea
• You pay premiums → insurer pays beneficiaries
Who Needs It
• Anyone with dependents / financial responsibilities
How Much (FORMULA)
• Income × 7 × 0.70
Types of Life Insurance
Term Life
• Temporary
• Cheapest
• No savings
Whole Life
• Lifetime coverage
• Builds cash value
Other Types
• Group life → job
• Credit life → pays debt (not recommended)
Key Features
Policy Stuff
• Grace period → extra time to pay
• Reinstatement → restart policy
• Policy loan → borrow from cash value
Clauses
• Incontestability → can’t dispute later
• Nonforfeiture → keep some value
Riders (ADD-ONS)
• Waiver of premium (disability)
• Accidental death (double payout)
• Cost-of-living (inflation)
• Accelerated benefits (early payout)
Payout Options
• Lump sum
• Installments
• Life income (annuity)
BIG TEST DIFFERENCES
• Health insurance = YOU (medical costs)
• Life insurance = YOUR FAMILY (after death)
• Term = cheap + temporary
• Whole = expensive + lifetime + savings
• Deductible vs Coinsurance = VERY important
If you want, I can hit you with a 10-question practice quiz that looks almost exactly like your exam 👀
