Question 1

One method of managing risk is to limit your exposure to a financial loss.

Accepted Answer

A) True 
 B)False

Question 2

Auto insurance rates are based upon

Accepted Answer

A)  whether you keep your car in the garage or not. 
B)  your marital status. 
C)  the number of miles and the type of driving you do each year. 
D)  the condition of your vehicle. 
A)  whether you keep your car in the garage or not. 
B)  your marital status. 
C)  the number of miles and the type of driving you do each year. 
D)  the condition of your vehicle.

Question 3

Medical payments coverage insures against costs of medical care for you and other passengers in your car when you are at fault in an accident.

Accepted Answer

A) True 
 B)False

Question 4

Having adequate amounts of auto and homeowner's insurance affects your financial plan by

Accepted Answer

A)  limiting your liability to others. 
B)  protecting your net worth and making it larger in the future. 
C)  making you less likely to be sued. 
D)  All of the above 
A)  limiting your liability to others. 
B)  protecting your net worth and making it larger in the future. 
C)  making you less likely to be sued. 
D)  All of the above

Question 5

The most popular forms of insurance for individuals are property and casualty,life insurance,and health insurance.

Accepted Answer

A) True 
 B)False

Question 6

Your automobile insurance policy contains policy limits of 200/300/100.If you have an accident in which you are deemed at fault and two people sustain bodily injuries that result in combined claims of $450,000,how much of the claim will not be covered under your insurance policy?

Accepted Answer

A)  $250,000 
B)  $150,000 
C)  $350,000 
D)  $450,000 
A)  $250,000 
B)  $150,000 
C)  $350,000 
D)  $450,000

Question 7

During an unusually heavy rain,the basement of your house flooded and an antique dresser from the 1860s was destroyed.The dresser was originally purchased for $1,300 10 years ago and was recently appraised for $2,600; you recently received an offer from an antique collector for $3,100.Under a standard homeowner's policy,how much would you receive from your insurance company to cover this loss?

Accepted Answer

A)  zero 
B)  $1,300 
C)  $2,600 
D)  $3,100 
A)  zero 
B)  $1,300 
C)  $2,600 
D)  $3,100

Question 8

In general,the cost of comprehensive and collision insurance is the most expensive part of your automobile policy and represents about 60% of the cost.

Accepted Answer

A) True 
 B)False

Question 9

________ is not a suggested risk management method.

Accepted Answer

A)  Avoiding risks 
B)  Ignoring risks 
C)  Accepting risks 
D)  Insuring against risks 
A)  Avoiding risks 
B)  Ignoring risks 
C)  Accepting risks 
D)  Insuring against risks

Question 10

Since insurance companies rely mostly on their premiums to cover claims,they price their insurance policies to reflect the probability of a claim and the size of the claim.

Accepted Answer

A) True 
 B)False

Question 11

In general,the most expensive part of your automobile policy is ________ coverage.

Accepted Answer

A)  liability 
B)  comprehensive and collision 
C)  medical payments 
D)  uninsured motorist 
A)  liability 
B)  comprehensive and collision 
C)  medical payments 
D)  uninsured motorist

Question 12

The most important reason to purchase an umbrella policy is

Accepted Answer

A)  supplement the liability coverage of your auto insurance policy. 
B)  supplement the liability coverage fo your homeowner's insurance policy. 
C)  protect your net worth. 
D)  A, B and C are all very important reasons. 
A)  supplement the liability coverage of your auto insurance policy. 
B)  supplement the liability coverage fo your homeowner's insurance policy. 
C)  protect your net worth. 
D)  A, B and C are all very important reasons.

Question 13

If you are in an auto accident,you should leave the scene of the accident to go home and call the police from home.

Accepted Answer

A) True 
 B)False

Question 14

Insurance should be considered even when there is a high likelihood than an event will cause a small financial loss.

Accepted Answer

A) True 
 B)False

Question 15

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

Question 16

Comprehensive coverage would cover financial losses due to

Accepted Answer

A)  injuries caused by a driver without insurance. 
B)  damage to your car in an accident for which you were at fault. 
C)  damage to your car caused by wind or hail. 
D)  damage to a neighbor's tree caused by your car. 
A)  injuries caused by a driver without insurance. 
B)  damage to your car in an accident for which you were at fault. 
C)  damage to your car caused by wind or hail. 
D)  damage to a neighbor's tree caused by your car.

One method of managing risk is to limit your exposure to a financial loss.

Auto insurance rates are based upon

Medical payments coverage insures against costs of medical care for you and other passengers in your car when you are at fault in an accident.

Having adequate amounts of auto and homeowner's insurance affects your financial plan by

The most popular forms of insurance for individuals are property and casualty,life insurance,and health insurance.

Your automobile insurance policy contains policy limits of 200/300/100.If you have an accident in which you are deemed at fault and two people sustain bodily injuries that result in combined claims of $450,000,how much of the claim will not be covered under your insurance policy?

In general,the cost of comprehensive and collision insurance is the most expensive part of your automobile policy and represents about 60% of the cost.

________ is not a suggested risk management method.

Since insurance companies rely mostly on their premiums to cover claims,they price their insurance policies to reflect the probability of a claim and the size of the claim.

In general,the most expensive part of your automobile policy is ________ coverage.

The most important reason to purchase an umbrella policy is

If you are in an auto accident,you should leave the scene of the accident to go home and call the police from home.

Insurance should be considered even when there is a high likelihood than an event will cause a small financial loss.

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

Comprehensive coverage would cover financial losses due to

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

Filters

Exam 11: Auto and Homeowners Insurance

One method of managing risk is to limit your exposure to a financial loss.

Auto insurance rates are based upon

Medical payments coverage insures against costs of medical care for you and other passengers in your car when you are at fault in an accident.

Having adequate amounts of auto and homeowner's insurance affects your financial plan by

The most popular forms of insurance for individuals are property and casualty,life insurance,and health insurance.

Your automobile insurance policy contains policy limits of 200/300/100.If you have an accident in which you are deemed at fault and two people sustain bodily injuries that result in combined claims of $450,000,how much of the claim will not be covered under your insurance policy?

In general,the cost of comprehensive and collision insurance is the most expensive part of your automobile policy and represents about 60% of the cost.

________ is not a suggested risk management method.

Since insurance companies rely mostly on their premiums to cover claims,they price their insurance policies to reflect the probability of a claim and the size of the claim.

In general,the most expensive part of your automobile policy is ________ coverage.

The most important reason to purchase an umbrella policy is

If you are in an auto accident,you should leave the scene of the accident to go home and call the police from home.

Insurance should be considered even when there is a high likelihood than an event will cause a small financial loss.

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

Comprehensive coverage would cover financial losses due to

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

Filters