Question 1

Who are the different parties to a life insurance contract? How is a beneficiary determined for a life insurance?

Accepted Answer

There are four parties to a life insuran

Question 2

________ is a form of property insurance that insures an automobile from loss or damage due to causes other than collision.

Accepted Answer

A) Omnibus insurance 
B) Comprehensive insurance 
C) Coinsurance clause 
D) No-fault automobile insurance 
A) Omnibus insurance 
B) Comprehensive insurance 
C) Coinsurance clause 
D) No-fault automobile insurance

Question 3

In the context of insurance, what does the term "premium" refer to?

Accepted Answer

A) the money received from the defaulting party 
B) the money paid to the insurance company 
C) the money paid to insured after an accidental damage 
D) the money paid to insurance brokers as fee 
A) the money received from the defaulting party 
B) the money paid to the insurance company 
C) the money paid to insured after an accidental damage 
D) the money paid to insurance brokers as fee

Question 4

Collision insurance covers damages to a car in a natural disaster.

Accepted Answer

A) True 
 B)False

Question 5

Roger Ray runs a motel in a rented property and sublets a part of its garage to the owner of a nearby fuel station.Three months later, the motel catches fire from a fuel leak in the garage and Roger suffers severe damages.If Roger owns a standard fire insurance policy for years, the insurer can use the ________ to refuse covering the damage caused by the fire.

Accepted Answer

A) deductible clause 
B) exclusions from coverage clause 
C) incontestability clause 
D) copay clause 
A) deductible clause 
B) exclusions from coverage clause 
C) incontestability clause 
D) copay clause

Question 6

An employee of a company that provides ________ insurance to its employees can receive payments, as provided by the policy, for injuries suffered by employees while working on the job.

Accepted Answer

A) disability 
B) life 
C) homeowner's 
D) standard fire 
A) disability 
B) life 
C) homeowner's 
D) standard fire

Question 7

An insurer will issue an umbrella policy only if a stipulated minimum amount of basic coverage on other insurance policies has been purchased by the insured.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following statements is true of the suicide clause in a life insurance?

Accepted Answer

A) The insurer is liable to pay in cases of legitimate suicides even if the life insurance policy had elapsed. 
B) The suicide clause has a specified date set. 
C) The insurer doesn't have to pay the beneficiary even if the suicide takes place after the specified date. 
D) The suicide has to occur within the specified date for payment. 
A) The insurer is liable to pay in cases of legitimate suicides even if the life insurance policy had elapsed. 
B) The suicide clause has a specified date set. 
C) The insurer doesn't have to pay the beneficiary even if the suicide takes place after the specified date. 
D) The suicide has to occur within the specified date for payment.

Question 9

A personal articles floater provides coverage for loss or damage to the articles while traveling.

Accepted Answer

A) True 
 B)False

Question 10

Helen has a $40, 000 automobile collision policy with a $750 deductible.If her car is involved in an accident costing $15, 000 in damages, ________ is the amount she will have to pay to receive coverage for the damages from the insurer.

Accepted Answer

A) $750 
B) $39, 250 
C) $40, 000 
D) $14, 250 
A) $750 
B) $39, 250 
C) $40, 000 
D) $14, 250

Question 11

An insured can cover his automobile under both collision insurance and comprehensive insurance simultaneously.

Accepted Answer

A) True 
 B)False

Question 12

What is an automobile liability insurance?

Accepted Answer

A) an insurance that covers the insured's automobile from theft 
B) an insurance that covers the insured's automobile from collision with another car 
C) an insurance that covers damages that the insured causes to third parties 
D) an insurance that covers the insured's automobile from natural disasters 
A) an insurance that covers the insured's automobile from theft 
B) an insurance that covers the insured's automobile from collision with another car 
C) an insurance that covers damages that the insured causes to third parties 
D) an insurance that covers the insured's automobile from natural disasters

Question 13

Hillary had purchased a term life insurance policy and nominated her mother as the beneficiary, while William, her colleague, had a universal life insurance with himself as the beneficiary.Hillary and William recently got married and wish to nominate each other as beneficiaries in their individual life insurance policies.In the context of the given scenario, which of the following statements is true?

Accepted Answer

A) Hillary and William will have to purchase two new policies to nominate each other as beneficiaries. 
B) Hillary and William will have to seek an endorsement to make the requisite changes in their current individual life insurance policies. 
C) Hillary will be able to nominate William as the beneficiary, but William cannot to do so because he did not enlist a beneficiary earlier. 
D) William will have to nominate both Hillary and her mother as beneficiaries for his insurance policy because existing beneficiaries cannot be denied coverage. 
A) Hillary and William will have to purchase two new policies to nominate each other as beneficiaries. 
B) Hillary and William will have to seek an endorsement to make the requisite changes in their current individual life insurance policies. 
C) Hillary will be able to nominate William as the beneficiary, but William cannot to do so because he did not enlist a beneficiary earlier. 
D) William will have to nominate both Hillary and her mother as beneficiaries for his insurance policy because existing beneficiaries cannot be denied coverage.

Question 14

Lucy Ann's boutique was burned down in a fire caused by a short circuit in the building.The fire caused the death of the boutique's co-owner and injured two of its workers.The estimated time frame for rebuilding the boutique was 5 months, but Lucy Ann was insured by a policy that reimbursed the loss of money that these 5 months of lost business would cause.
-What kind of insurance provides such coverage?

Accepted Answer

A) product liability insurance 
B) key-person life insurance 
C) workers' compensation insurance 
D) business interruption insurance 
A) product liability insurance 
B) key-person life insurance 
C) workers' compensation insurance 
D) business interruption insurance

Question 15

Which of the following types of insurances will help an owner of a real property establish clear ownership over that property?

Accepted Answer

A) comprehensive insurance 
B) title insurance 
C) omnibus insurance 
D) renter's insurance 
A) comprehensive insurance 
B) title insurance 
C) omnibus insurance 
D) renter's insurance

Question 16

Insurance is a form of coverage for loss that is initiated after the loss has occurred.

Accepted Answer

A) True 
 B)False

Question 17

For a life insurance, the owner and beneficiary cannot be the same person.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following clauses protects the insurers from intentional or unintentional material or informative misrepresentation from an insurance applicant?

Accepted Answer

A) exclusions from coverage clause 
B) incontestability clause 
C) deductible clause 
D) coinsurance clause 
A) exclusions from coverage clause 
B) incontestability clause 
C) deductible clause 
D) coinsurance clause

Question 19

A(n)________ is a clause in an insurance policy that provides that insurance proceeds are payable only after the insured has paid a specified amount toward the damage or loss.

Accepted Answer

A) incontestability clause 
B) coinsurance clause 
C) exclusions from coverage clause 
D) deductible clause 
A) incontestability clause 
B) coinsurance clause 
C) exclusions from coverage clause 
D) deductible clause

Question 20

What is a key-person life insurance? How does it influence a buy-sell agreement?

Accepted Answer

In many small businesses, such as partne

Exam 50: Insurance

Who are the different parties to a life insurance contract? How is a beneficiary determined for a life insurance?

________ is a form of property insurance that insures an automobile from loss or damage due to causes other than collision.

In the context of insurance, what does the term "premium" refer to?

Collision insurance covers damages to a car in a natural disaster.

An employee of a company that provides ________ insurance to its employees can receive payments, as provided by the policy, for injuries suffered by employees while working on the job.

An insurer will issue an umbrella policy only if a stipulated minimum amount of basic coverage on other insurance policies has been purchased by the insured.

Which of the following statements is true of the suicide clause in a life insurance?

A personal articles floater provides coverage for loss or damage to the articles while traveling.

Helen has a $40, 000 automobile collision policy with a $750 deductible.If her car is involved in an accident costing $15, 000 in damages, ________ is the amount she will have to pay to receive coverage for the damages from the insurer.

An insured can cover his automobile under both collision insurance and comprehensive insurance simultaneously.

What is an automobile liability insurance?

Which of the following types of insurances will help an owner of a real property establish clear ownership over that property?

Insurance is a form of coverage for loss that is initiated after the loss has occurred.

For a life insurance, the owner and beneficiary cannot be the same person.

Which of the following clauses protects the insurers from intentional or unintentional material or informative misrepresentation from an insurance applicant?

A(n)________ is a clause in an insurance policy that provides that insurance proceeds are payable only after the insured has paid a specified amount toward the damage or loss.

What is a key-person life insurance? How does it influence a buy-sell agreement?

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