Question 1

One of the four questions that should be asked when developing a risk management plan is "What do I need to insure?"

Accepted Answer

A) True 
 B)False

Question 2

If you choose to wear your seatbelt, you are using

Accepted Answer

A)  Risk avoidance. 
B)  Risk reduction. 
C)  Risk assumption. 
D)  Risk shifting. 
E)  Risk increasing. 
A)  Risk avoidance. 
B)  Risk reduction. 
C)  Risk assumption. 
D)  Risk shifting. 
E)  Risk increasing.

Question 3

Patrick has an old car and wants to keep his insurance costs down, but he wants coverage in case he damages the property of others, including street signs and telephone poles. In order to minimize the financial impact of an accident he may cause, he should, at a minimum, carry which type of insurance?

Accepted Answer

A)  Property damage liability coverage. 
B)  Collision coverage. 
C)  Comprehensive physical damage coverage. 
D)  Bodily injury liability coverage. 
E)  Medical payments coverage. 
A)  Property damage liability coverage. 
B)  Collision coverage. 
C)  Comprehensive physical damage coverage. 
D)  Bodily injury liability coverage. 
E)  Medical payments coverage.

Question 4

Anything that may possibly cause a loss is called a

Accepted Answer

A)  Hazard. 
B)  Negligence. 
C)  Peril. 
D)  Premium. 
E)  Speculation. 
A)  Hazard. 
B)  Negligence. 
C)  Peril. 
D)  Premium. 
E)  Speculation.

Question 5

An insurance company is a _________ business that agrees to pay for losses that may happen to someone it insures.

Accepted Answer

A)  risk-reducing. 
B)  risk-assuming. 
C)  risk-sharing. 
D)  risk-avoiding. 
E)  risk-eliminating. 
A)  risk-reducing. 
B)  risk-assuming. 
C)  risk-sharing. 
D)  risk-avoiding. 
E)  risk-eliminating.

Question 6

The most common risks are

Accepted Answer

A)  Personal risks. 
B)  Property risks. 
C)  Liability risks. 
D)  All of these are common risks. 
E)  None of these are common risks. 
A)  Personal risks. 
B)  Property risks. 
C)  Liability risks. 
D)  All of these are common risks. 
E)  None of these are common risks.

Question 7

Homeowner's insurance excludes detached structures on your property.

Accepted Answer

A) True 
 B)False

Question 8

Caroline was found liable in an accident. This is usually not due to negligence on her part.

Accepted Answer

A) True 
 B)False

Question 9

A landlord is responsible for paying renter's insurance.

Accepted Answer

A) True 
 B)False

Question 10

A homeowner's insurance policy provides coverage for additional living expenses so you can stay somewhere else if a fire damages your home.

Accepted Answer

A) True 
 B)False

Question 11

Sally was driving her own car and collided with a pickup truck. Sally sustained $125,000 in injuries, and her passenger sustained $10,000 in injuries. If her coverage was 100/300/50, what are the total medical expenses the insurance company would pay for this accident?

Accepted Answer

A)  $1,000 
B)  $100,000 
C)  $110,000 
D)  $125,000 
E)  $135,000 
A)  $1,000 
B)  $100,000 
C)  $110,000 
D)  $125,000 
E)  $135,000

Question 12

Homeowner's insurance covers all of the following except

Accepted Answer

A)  A detached garage. 
B)  Trees and shrubs. 
C)  A toolshed. 
D)  Personal property. 
E)  All of these are covered. 
A)  A detached garage. 
B)  Trees and shrubs. 
C)  A toolshed. 
D)  Personal property. 
E)  All of these are covered.

Question 13

Homeowner's insurance covers all of the following except

Accepted Answer

A)  Furniture. 
B)  Theft of jewelry valued at $25,000. 
C)  Appliance. 
D)  Clothing. 
E)  Rental rug cleaner. 
A)  Furniture. 
B)  Theft of jewelry valued at $25,000. 
C)  Appliance. 
D)  Clothing. 
E)  Rental rug cleaner.

Question 14

Liability is defined as

Accepted Answer

A)  An insurance program for individuals and households. 
B)  The legal responsibility for the financial cost of another person's losses or injuries. 
C)  Negligence. 
D)  A loss due to physical damage. 
E)  Risk assumption. 
A)  An insurance program for individuals and households. 
B)  The legal responsibility for the financial cost of another person's losses or injuries. 
C)  Negligence. 
D)  A loss due to physical damage. 
E)  Risk assumption.

Question 15

Renter's insurance is quite expensive while mobile home insurance is relatively inexpensive.

Accepted Answer

A) True 
 B)False

Question 16

What is the fee that a policyholder pays when an insurance company agrees to take on the risk?

Accepted Answer

A)  Coverage 
B)  Insured 
C)  Premium 
D)  Peril 
E)  Risk 
A)  Coverage 
B)  Insured 
C)  Premium 
D)  Peril 
E)  Risk

Question 17

Sam's house should be insured for the amount he originally paid for it.

Accepted Answer

A) True 
 B)False

Question 18

Various states are trying to reduce the time and cost of settling vehicle injury cases. One alternative is

Accepted Answer

A)  Omitting uninsured motorist's protection. 
B)  Requiring the driver to pay all medical expenses. 
C)  Using the no-fault system. 
D)  Requiring emergency road service coverage. 
E)  Having the state pay for driver's insurance. 
A)  Omitting uninsured motorist's protection. 
B)  Requiring the driver to pay all medical expenses. 
C)  Using the no-fault system. 
D)  Requiring emergency road service coverage. 
E)  Having the state pay for driver's insurance.

Question 19

Madeline had a severe allergy attack and crashed her car into a telephone pole while sneezing. The damage to the telephone pole would be covered under Madeline's

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 20

Towing and emergency road service coverage includes coverage for a tow to a service station as well as repairs to make the vehicle drivable.

Accepted Answer

A) True 
 B)False

One of the four questions that should be asked when developing a risk management plan is "What do I need to insure?"

If you choose to wear your seatbelt, you are using

Anything that may possibly cause a loss is called a

An insurance company is a _________ business that agrees to pay for losses that may happen to someone it insures.

The most common risks are

Homeowner's insurance excludes detached structures on your property.

Caroline was found liable in an accident. This is usually not due to negligence on her part.

A landlord is responsible for paying renter's insurance.

A homeowner's insurance policy provides coverage for additional living expenses so you can stay somewhere else if a fire damages your home.

Sally was driving her own car and collided with a pickup truck. Sally sustained $125,000 in injuries, and her passenger sustained $10,000 in injuries. If her coverage was 100/300/50, what are the total medical expenses the insurance company would pay for this accident?

Homeowner's insurance covers all of the following except

Homeowner's insurance covers all of the following except

Liability is defined as

Renter's insurance is quite expensive while mobile home insurance is relatively inexpensive.

What is the fee that a policyholder pays when an insurance company agrees to take on the risk?

Sam's house should be insured for the amount he originally paid for it.

Various states are trying to reduce the time and cost of settling vehicle injury cases. One alternative is

Madeline had a severe allergy attack and crashed her car into a telephone pole while sneezing. The damage to the telephone pole would be covered under Madeline's

Towing and emergency road service coverage includes coverage for a tow to a service station as well as repairs to make the vehicle drivable.

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

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Exam 8: Home and Automobile Insurance

One of the four questions that should be asked when developing a risk management plan is "What do I need to insure?"

If you choose to wear your seatbelt, you are using

Anything that may possibly cause a loss is called a

An insurance company is a _________ business that agrees to pay for losses that may happen to someone it insures.

The most common risks are

Homeowner's insurance excludes detached structures on your property.

Caroline was found liable in an accident. This is usually not due to negligence on her part.

A landlord is responsible for paying renter's insurance.

A homeowner's insurance policy provides coverage for additional living expenses so you can stay somewhere else if a fire damages your home.

Sally was driving her own car and collided with a pickup truck. Sally sustained $125,000 in injuries, and her passenger sustained $10,000 in injuries. If her coverage was 100/300/50, what are the total medical expenses the insurance company would pay for this accident?

Homeowner's insurance covers all of the following except

Homeowner's insurance covers all of the following except

Liability is defined as

Renter's insurance is quite expensive while mobile home insurance is relatively inexpensive.

What is the fee that a policyholder pays when an insurance company agrees to take on the risk?

Sam's house should be insured for the amount he originally paid for it.

Various states are trying to reduce the time and cost of settling vehicle injury cases. One alternative is

Madeline had a severe allergy attack and crashed her car into a telephone pole while sneezing. The damage to the telephone pole would be covered under Madeline's

Towing and emergency road service coverage includes coverage for a tow to a service station as well as repairs to make the vehicle drivable.

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