Question 1

Liability insurance coverage would cost more for an expensive car than for an inexpensive car of the same age.

Accepted Answer

A) True 
 B)False

Question 2

The coverage that is designed to protect you if you cause an accident where the driver or passenger of the other car sustains injuries and sues you is called ________.

Accepted Answer

bodily inj

Question 3

The bodily injury liability coverage of your automobile policy will not pay for

Accepted Answer

A) medical expenses of those in the other car for an accident which you caused. 
B) lost wages of those in the other car for an accident which you caused. 
C) injuries to others in your car due to an accident for which you were at fault. 
D) pain and suffering lawsuit awards to those in another car due to an accident you caused. 
A) medical expenses of those in the other car for an accident which you caused. 
B) lost wages of those in the other car for an accident which you caused. 
C) injuries to others in your car due to an accident for which you were at fault. 
D) pain and suffering lawsuit awards to those in another car due to an accident you caused.

Question 4

Additional coverage on your automobile insurance policy can be purchased for

Accepted Answer

A) the cost of a rental car while your car is being repaired. 
B) the protection of valuables you are carrying in your car. 
C) the cost of towing,even if the problems are not the result of an accident. 
D) Both A and C are correct answers. 
A) the cost of a rental car while your car is being repaired. 
B) the protection of valuables you are carrying in your car. 
C) the cost of towing,even if the problems are not the result of an accident. 
D) Both A and C are correct answers.

Question 5

One of the problems with no-fault automobile insurance is that it

Accepted Answer

A) results in higher court costs. 
B) results in higher jury awards to victims. 
C) doesn't penalize drivers who cause accidents to the degree that they should be. 
D) hasn't resulted in lower costs to insurance companies or lower auto insurance premiums. 
A) results in higher court costs. 
B) results in higher jury awards to victims. 
C) doesn't penalize drivers who cause accidents to the degree that they should be. 
D) hasn't resulted in lower costs to insurance companies or lower auto insurance premiums.

Question 6

The 25 in 50/100/25 refers to ________ coverage.

Accepted Answer

A) collision 
B) bodily injury liability 
C) comprehensive physical damage 
D) property damage liability 
A) collision 
B) bodily injury liability 
C) comprehensive physical damage 
D) property damage liability

Question 7

Which of the following would pay for medical care for people who were injured in your automobile as a result of an accident that was your fault?

Accepted Answer

A) Medical payments 
B) Bodily injury liability 
C) Collision 
D) Comprehensive 
A) Medical payments 
B) Bodily injury liability 
C) Collision 
D) Comprehensive

Question 8

The amount of damage that you will be required to cover if your car is involved in an accident that is your fault is your

Accepted Answer

A) deductible. 
B) co-payment. 
C) premium. 
D) fair share. 
A) deductible. 
B) co-payment. 
C) premium. 
D) fair share.

Question 9

List four ways to reduce your automobile insurance premiums.

Accepted Answer

Any four of the following: ∙ Buy a less

Question 10

All of the following may qualify for an auto discount except

Accepted Answer

A) high grades. 
B) a driver's training program. 
C) several cars insured with the same company. 
D) under 25 years old. 
A) high grades. 
B) a driver's training program. 
C) several cars insured with the same company. 
D) under 25 years old.

Question 11

Which of the following is not true regarding medical payments coverage?

Accepted Answer

A) It covers both family and non-family members. 
B) It is not recommended or needed if you have health insurance. 
C) It may even cover funeral expenses. 
D) Insurance professionals recommend coverage of about $10,000 per person. 
A) It covers both family and non-family members. 
B) It is not recommended or needed if you have health insurance. 
C) It may even cover funeral expenses. 
D) Insurance professionals recommend coverage of about $10,000 per person.

Question 12

Which of the following is not a characteristic of an umbrella policy?

Accepted Answer

A) It provides additional liability insurance 
B) It replaces other policies 
C) It protects wealth 
D) It is optional coverage 
A) It provides additional liability insurance 
B) It replaces other policies 
C) It protects wealth 
D) It is optional coverage

Question 13

A personal umbrella policy gives liability coverage to replace that which would normally be needed by an automobile or homeowner's policy.

Accepted Answer

A) True 
 B)False

Question 14

Insurance can protect your existing net worth and also increase the likelihood that you will be able to increase your net worth in the future.

Accepted Answer

A) True 
 B)False

Question 15

Lessening your exposure to an illness by getting periodic health checkups is an example of

Accepted Answer

A) avoiding risks. 
B) reducing risks. 
C) accepting risks. 
D) transferring risks. 
A) avoiding risks. 
B) reducing risks. 
C) accepting risks. 
D) transferring risks.

Question 16

Insurance agents who work for one particular company are called

Accepted Answer

A) company agents. 
B) captive agents. 
C) independent agents. 
D) freelance agents. 
A) company agents. 
B) captive agents. 
C) independent agents. 
D) freelance agents.

Question 17

An umbrella policy is designed to cover

Accepted Answer

A) additional buildings on your property. 
B) property when traveling away from home. 
C) major personal liability suits. 
D) flood damage. 
A) additional buildings on your property. 
B) property when traveling away from home. 
C) major personal liability suits. 
D) flood damage.

Question 18

Which of the following is not a service company that would rate the financial condition of insurance companies?

Accepted Answer

A) 
A) M.Best 
B) Kelly's Blue Book 
C) Moody's Investor Services 
D) Standard and Poor's Corporation 
A) 
A) M.Best 
B) Kelly's Blue Book 
C) Moody's Investor Services 
D) Standard and Poor's Corporation

Question 19

What do policy limits of 200/300/100 on an automobile insurance policy mean?

Accepted Answer

$200,000 per person injured in

Question 20

A higher deductible reduces the amount of coverage provided by homeowner's insurance,and therefore results in a lower insurance premium.

Accepted Answer

A) True 
 B)False

Exam 11: Auto and Homeowners Insurance

Liability insurance coverage would cost more for an expensive car than for an inexpensive car of the same age.

The coverage that is designed to protect you if you cause an accident where the driver or passenger of the other car sustains injuries and sues you is called ________.

The bodily injury liability coverage of your automobile policy will not pay for

Additional coverage on your automobile insurance policy can be purchased for

One of the problems with no-fault automobile insurance is that it

The 25 in 50/100/25 refers to ________ coverage.

Which of the following would pay for medical care for people who were injured in your automobile as a result of an accident that was your fault?

The amount of damage that you will be required to cover if your car is involved in an accident that is your fault is your

List four ways to reduce your automobile insurance premiums.

All of the following may qualify for an auto discount except

Which of the following is not true regarding medical payments coverage?

Which of the following is not a characteristic of an umbrella policy?

A personal umbrella policy gives liability coverage to replace that which would normally be needed by an automobile or homeowner's policy.

Insurance can protect your existing net worth and also increase the likelihood that you will be able to increase your net worth in the future.

Lessening your exposure to an illness by getting periodic health checkups is an example of

Insurance agents who work for one particular company are called

An umbrella policy is designed to cover

Which of the following is not a service company that would rate the financial condition of insurance companies?

What do policy limits of 200/300/100 on an automobile insurance policy mean?

A higher deductible reduces the amount of coverage provided by homeowner's insurance,and therefore results in a lower insurance premium.

Overview of a Financial Plan

Planning With Personal Financial Statements

Applying Time Value Concepts

Using Tax Concepts for Planning

Banking and Interest Rates

Managing Your Money

Assessing and Securing Your Credit

Managing Your Credit

Personal Loans

Purchasing and Financing a Home

Health and Disability Insurance

Life Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Asset Allocation

Retirement Planning

Estate Planning

Integrating the Components of a Financial Plan

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