GFL Strand 4, Standard 4: Risk Management in Asset Protection

What is risk management?

• Avoiding financial risks entirely to protect assets.

• Managing financial risks to reduce potential losses.

• Using emergency funds to solve all financial issues.

• Eliminating the need for insurance by saving money.

What is the purpose of insurance?

• To ensure that you never lose any money.

• To transfer financial risks to an insurer for a fee.

• To cover regular expenses like rent and utilities.

• To prevent accidents or unexpected losses entirely.

What is a premium in an insurance policy?

• A one-time fee paid when you file a claim.

• A regular payment to keep the insurance active.

• A percentage of your deductible required for approval.

• The total coverage limit agreed upon in the policy.

What is a deductible?

• A percentage of your monthly premium refunded later.

• The amount you pay before insurance covers costs.

• A fee charged for making changes to your insurance plan.

• The refund you receive for unused coverage.

What is life insurance?

• A savings plan for retirement income.

• A policy providing money to beneficiaries after death.

• Insurance that covers both your home and car.

• A type of account used for future investments.

What is the difference between term life and whole life insurance?

• Term life covers a set time, while whole life lasts a lifetime.

• Whole life costs less but provides less coverage.

• Term life automatically builds cash value.

• Whole life only pays out if certain conditions are met.

What is the purpose of automobile insurance?

• To cover damages or injuries from car accidents.

• To reduce maintenance costs for your car.

• To provide a loan for buying a new vehicle.

• To cover the cost of regular oil changes.

What does homeowner’s insurance cover?

• Repairs and upgrades to appliances and fixtures.

• Damages to your home and belongings from events like fires.

• Monthly mortgage payments if you lose income.

• Preventative maintenance costs like roof inspections.

What is the purpose of health insurance?

• To pay for unexpected medical expenses.

• To eliminate all medical-related bills entirely.

• To guarantee free healthcare for emergencies.

• To cover only minor illnesses like the flu.

What is disability insurance?

• A plan that pays for medical costs after an injury.

• Insurance that replaces part of your income if you can’t work.

• A savings plan that provides money in emergencies.

• A loan to help pay off medical debt quickly.