Question 1

Defective house wiring is a hazard that increases the chance that a fire will start.

Accepted Answer

A) True 
 B)False

Question 2

If you have a loss due to a flood,

Accepted Answer

A)  Your homeowner's insurance should normally cover the loss. 
B)  You must have already purchased special coverage if you live in an area that has frequent floods in order to be covered. 
C)  FEMA (Federal Emergency Management Agency) will automatically provide coverage if this is your second flood loss. 
D)  You need an umbrella policy for coverage. 
E)  Your additional living expenses coverage will apply if you move to an area that has not flooded in one year. 
A)  Your homeowner's insurance should normally cover the loss. 
B)  You must have already purchased special coverage if you live in an area that has frequent floods in order to be covered. 
C)  FEMA (Federal Emergency Management Agency) will automatically provide coverage if this is your second flood loss. 
D)  You need an umbrella policy for coverage. 
E)  Your additional living expenses coverage will apply if you move to an area that has not flooded in one year.

Question 3

Albert left his vehicle parked on the street in the front of his house when he went on vacation. While he was gone, his street flooded and his car was severely damaged. This damage would be covered under his

Accepted Answer

A)  Uninsured motorist's protection. 
B)  Property damage liability coverage. 
C)  Collision coverage. 
D)  Comprehensive physical damage coverage. 
E)  Bodily injury liability coverage. 
A)  Uninsured motorist's protection. 
B)  Property damage liability coverage. 
C)  Collision coverage. 
D)  Comprehensive physical damage coverage. 
E)  Bodily injury liability coverage.

Question 4

Andrew is applying for insurance for his new home. Which of the following is correct?

Accepted Answer

A)  He should base the amount of insurance on the price he paid for it. 
B)  He should insure the building for 75% of its replacement cost. 
C)  He should use the replacement value method for settling claims to receive the full cost of repairing or replacing his personal belongings. 
D)  His personal belongings should be covered with his home at 125% of his home's insured amount. 
E)  His insured amount should remain the same as long as he lives in his house. 
A)  He should base the amount of insurance on the price he paid for it. 
B)  He should insure the building for 75% of its replacement cost. 
C)  He should use the replacement value method for settling claims to receive the full cost of repairing or replacing his personal belongings. 
D)  His personal belongings should be covered with his home at 125% of his home's insured amount. 
E)  His insured amount should remain the same as long as he lives in his house.

Question 5

Jim and Sandy are developing a personal insurance program. One of their goals should be to reduce the possible loss of income due to fire or theft.

Accepted Answer

A) True 
 B)False

Question 6

Motor vehicle insurance falls into two categories: protection for bodily injury and protection for property damage.

Accepted Answer

A) True 
 B)False

Question 7

Zach is applying for insurance for his new home. Which of the following is correct?

Accepted Answer

A)  He should base the amount of insurance on the price he paid for the new home. 
B)  He should insure the building under the replacement value method to receive the full cost of repairing or replacing it. 
C)  He should use the actual cash value method for settling claims to receive the full cost of repairing or replacing his personal belongings. 
D)  His personal belongings should automatically be covered with his home at 125% of his home's insured amount. 
E)  His insured amount should remain the same as long as he lives in his house. 
A)  He should base the amount of insurance on the price he paid for the new home. 
B)  He should insure the building under the replacement value method to receive the full cost of repairing or replacing it. 
C)  He should use the actual cash value method for settling claims to receive the full cost of repairing or replacing his personal belongings. 
D)  His personal belongings should automatically be covered with his home at 125% of his home's insured amount. 
E)  His insured amount should remain the same as long as he lives in his house.

Question 8

Personal liability coverage does NOT protect

Accepted Answer

A)  An occasional babysitter. 
B)  The cost of legal defense. 
C)  A guest. 
D)  Members of the homeowner's family who accidentally break a neighbor's antique lamp. 
E)  A housekeeper. 
A)  An occasional babysitter. 
B)  The cost of legal defense. 
C)  A guest. 
D)  Members of the homeowner's family who accidentally break a neighbor's antique lamp. 
E)  A housekeeper.

Question 9

The two basic types of risk that people face regarding potential property losses are

Accepted Answer

A)  Basic and criminal. 
B)  Physical damage and destruction. 
C)  Destruction and basic. 
D)  Physical damage and damage caused by criminal behavior. 
E)  Negligence and criminal behavior. 
A)  Basic and criminal. 
B)  Physical damage and destruction. 
C)  Destruction and basic. 
D)  Physical damage and damage caused by criminal behavior. 
E)  Negligence and criminal behavior.

Question 10

Robby fell on some ice on Peter's front steps and broke his arm. This is an example of a risk covered by the personal liability portion of Peter's homeowner's policy.

Accepted Answer

A) True 
 B)False

Question 11

Uninsured motorist's protection automatically covers you and your family members as well as damage to the vehicle itself.

Accepted Answer

A) True 
 B)False

Question 12

A home insured for $160,000 has 55% worth of coverage for household belongings, which is $112,000.

Accepted Answer

A) True 
 B)False

Question 13

You can save no more than 30% on homeowner's insurance by comparing rates from several companies.

Accepted Answer

A) True 
 B)False

Question 14

Amber had permission from Bradley to borrow his car to run some errands. Unfortunately, while Amber was driving, she looked down to change songs on her iPod and sideswiped a car and hit a bicyclist. Based on her experience, which of the following would be true?

Accepted Answer

A)  Amber's insurance company should refuse coverage of her medical payments because she was not driving in her own vehicle. 
B)  The insurance company of the owner of the sideswiped car should pay for all damages since the car was illegally parked. 
C)  Amber's insurance should not cover any damage since she carried liability, collision, and comprehensive coverage. 
D)  The bicyclist should cover his own medical expenses because he was at fault for riding on the road. 
E)  Amber's insurance policy should cover any property damage claims since she was driving Bradley's car with his permission. 
A)  Amber's insurance company should refuse coverage of her medical payments because she was not driving in her own vehicle. 
B)  The insurance company of the owner of the sideswiped car should pay for all damages since the car was illegally parked. 
C)  Amber's insurance should not cover any damage since she carried liability, collision, and comprehensive coverage. 
D)  The bicyclist should cover his own medical expenses because he was at fault for riding on the road. 
E)  Amber's insurance policy should cover any property damage claims since she was driving Bradley's car with his permission.

Question 15

Last month some of your friends were injured in an accident. Their total injuries were as follows: * Brenda $\quad \$ 85,000$
* Raquel $\$ 125,000$
* Louis $\quad \$ 40,000$ Coverage was 100/300/50. What was the total medical coverage in this accident?

Accepted Answer

A)  $40,000 
B)  $85,000 
C)  $125,000 
D)  $225,000 
E)  $250,000 
A)  $40,000 
B)  $85,000 
C)  $125,000 
D)  $225,000 
E)  $250,000

Question 16

Motor vehicle bodily injury coverage typically includes all of the following except

Accepted Answer

A)  Legal expenses. 
B)  Bodily injury liability up to a specific level for all injured in an accident. 
C)  Medical payments coverage. 
D)  Bodily injury liability of all expenses, no matter the cost, for the most injured. 
E)  Uninsured motorist's protection. 
A)  Legal expenses. 
B)  Bodily injury liability up to a specific level for all injured in an accident. 
C)  Medical payments coverage. 
D)  Bodily injury liability of all expenses, no matter the cost, for the most injured. 
E)  Uninsured motorist's protection.

Question 17

Home insurance policies include coverage for all of the following except

Accepted Answer

A)  Credit card fraud. 
B)  The cost of removing damaged property. 
C)  Temporary repairs after a loss to prevent further damage. 
D)  Business property. 
E)  Emergency removal of property to protect it from damage. 
A)  Credit card fraud. 
B)  The cost of removing damaged property. 
C)  Temporary repairs after a loss to prevent further damage. 
D)  Business property. 
E)  Emergency removal of property to protect it from damage.

Question 18

The best place to keep a household inventory is

Accepted Answer

A)  On a bookshelf in the family room. 
B)  In the freezer. 
C)  In the attic. 
D)  In a safe deposit box. 
E)  In the garage. 
A)  On a bookshelf in the family room. 
B)  In the freezer. 
C)  In the attic. 
D)  In a safe deposit box. 
E)  In the garage.

Question 19

Which of the following is NOT correct about renter's insurance?

Accepted Answer

A)  The broad form covers personal property against perils specified in the policy. 
B)  Renter's insurance covers the building and other structures on the site. 
C)  The comprehensive form protects personal property against perils not specifically excluded in the policy. 
D)  Typical coverage pays only the actual cash value of one's losses. 
E)  Renter's insurance is relatively inexpensive. 
A)  The broad form covers personal property against perils specified in the policy. 
B)  Renter's insurance covers the building and other structures on the site. 
C)  The comprehensive form protects personal property against perils not specifically excluded in the policy. 
D)  Typical coverage pays only the actual cash value of one's losses. 
E)  Renter's insurance is relatively inexpensive.

Question 20

Medical payments coverage applies to medical expenses of

Accepted Answer

A)  Anyone who is injured in your vehicle, including you. 
B)  Anyone in your vehicle who is injured, except the driver. 
C)  The driver, but no passengers who are injured. 
D)  The owner of the vehicle, but not other passengers. 
E)  The uninsured motorist who causes an accident. 
A)  Anyone who is injured in your vehicle, including you. 
B)  Anyone in your vehicle who is injured, except the driver. 
C)  The driver, but no passengers who are injured. 
D)  The owner of the vehicle, but not other passengers. 
E)  The uninsured motorist who causes an accident.

Defective house wiring is a hazard that increases the chance that a fire will start.

If you have a loss due to a flood,

Albert left his vehicle parked on the street in the front of his house when he went on vacation. While he was gone, his street flooded and his car was severely damaged. This damage would be covered under his

Andrew is applying for insurance for his new home. Which of the following is correct?

Jim and Sandy are developing a personal insurance program. One of their goals should be to reduce the possible loss of income due to fire or theft.

Motor vehicle insurance falls into two categories: protection for bodily injury and protection for property damage.

Zach is applying for insurance for his new home. Which of the following is correct?

Personal liability coverage does NOT protect

The two basic types of risk that people face regarding potential property losses are

Robby fell on some ice on Peter's front steps and broke his arm. This is an example of a risk covered by the personal liability portion of Peter's homeowner's policy.

Uninsured motorist's protection automatically covers you and your family members as well as damage to the vehicle itself.

A home insured for $160,000 has 55% worth of coverage for household belongings, which is $112,000.

You can save no more than 30% on homeowner's insurance by comparing rates from several companies.

Amber had permission from Bradley to borrow his car to run some errands. Unfortunately, while Amber was driving, she looked down to change songs on her iPod and sideswiped a car and hit a bicyclist. Based on her experience, which of the following would be true?

Last month some of your friends were injured in an accident. Their total injuries were as follows: * Brenda $\quad \$ 85,000$ * Raquel $\$ 125,000$ * Louis $\quad \$ 40,000$ Coverage was 100/300/50. What was the total medical coverage in this accident?

Motor vehicle bodily injury coverage typically includes all of the following except

Home insurance policies include coverage for all of the following except

The best place to keep a household inventory is

Which of the following is NOT correct about renter's insurance?

Medical payments coverage applies to medical expenses of

Personal Financial Planning in Action

Money Management Skills

Taxes in Your Financial Plan

Financial Services: Saving Plans and Payment Accounts

Consumer Credit: Advantages, Disadvantages, Sources, and Costs

Consumer Purchasing Strategies and Wise Buying of Motor Vehicles

Selecting and Financing Housing

Health and Disability Insurance

Financial Planning With Life Insurance

Investing Fundamentals and Bonds

Investing in Stocks

Investing in Mutual Funds

Starting Early: Retirement and Estate Planning

Filters

Exam 8: Home and Automobile Insurance

Defective house wiring is a hazard that increases the chance that a fire will start.

If you have a loss due to a flood,

Albert left his vehicle parked on the street in the front of his house when he went on vacation. While he was gone, his street flooded and his car was severely damaged. This damage would be covered under his

Andrew is applying for insurance for his new home. Which of the following is correct?

Jim and Sandy are developing a personal insurance program. One of their goals should be to reduce the possible loss of income due to fire or theft.

Motor vehicle insurance falls into two categories: protection for bodily injury and protection for property damage.

Zach is applying for insurance for his new home. Which of the following is correct?

Personal liability coverage does NOT protect

The two basic types of risk that people face regarding potential property losses are

Robby fell on some ice on Peter's front steps and broke his arm. This is an example of a risk covered by the personal liability portion of Peter's homeowner's policy.

Uninsured motorist's protection automatically covers you and your family members as well as damage to the vehicle itself.

A home insured for $160,000 has 55% worth of coverage for household belongings, which is $112,000.

You can save no more than 30% on homeowner's insurance by comparing rates from several companies.

Amber had permission from Bradley to borrow his car to run some errands. Unfortunately, while Amber was driving, she looked down to change songs on her iPod and sideswiped a car and hit a bicyclist. Based on her experience, which of the following would be true?

Last month some of your friends were injured in an accident. Their total injuries were as follows: * Brenda $85,000\quad \$ 85,000$85,000 * Raquel $125,000\$ 125,000$125,000 * Louis $40,000\quad \$ 40,000$40,000 Coverage was 100/300/50. What was the total medical coverage in this accident?

Motor vehicle bodily injury coverage typically includes all of the following except

Home insurance policies include coverage for all of the following except

The best place to keep a household inventory is

Which of the following is NOT correct about renter's insurance?

Medical payments coverage applies to medical expenses of

Personal Financial Planning in Action

Money Management Skills

Taxes in Your Financial Plan

Financial Services: Saving Plans and Payment Accounts

Consumer Credit: Advantages, Disadvantages, Sources, and Costs

Consumer Purchasing Strategies and Wise Buying of Motor Vehicles

Selecting and Financing Housing

Health and Disability Insurance

Financial Planning With Life Insurance

Investing Fundamentals and Bonds

Investing in Stocks

Investing in Mutual Funds

Starting Early: Retirement and Estate Planning

Filters

Last month some of your friends were injured in an accident. Their total injuries were as follows: * Brenda $\quad \$ 85,000$ * Raquel $\$ 125,000$ * Louis $\quad \$ 40,000$ Coverage was 100/300/50. What was the total medical coverage in this accident?