Exam 10: Protecting Your Property

Kevin,who has liability limits of $20,000/$40,000/$20,000 and a $500 collision deductible,is involved in an accident.Due to his negligence he runs into a Rolls Royce.Three people sustained bodily injuries in the Rolls Royce.The driver's injuries were worth $1,000,000,a passenger received injuries worth $12,500,and another passenger received injuries of $7,100.How much will the PAP pay for these bodily injuries?

Section I of a homeowner's insurance policy covers all of the following except:

The most common definition of actual cash value is purchase price less depreciation.

Tom visits George at his ranch.Although a novice on horseback,Tom decides to join George in a morning ride.George recommends that Tom ride an unbroken stallion named Satan.While mounting Satan,Tom is thrown headlong through the windshield of Tom's car.The damage to the car is $2,000 and Tom's own insurance pays him $1,500 ($500 deductible).Under what principle could Tom's insurance company sue George for his negligence?

Homeowner's property insurance does not provide protection on the:

The best place to buy automobile insurance is your insurance agent.

A house with a replacement value of $110,000 is currently insured for $90,000.The house has suffered a $15,000 loss from windstorm damage.The insurance company will pay the full $15,000 less the deductible.

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement. -[Negligence | Indemnity] is the failure to act in a reasonable manner or take necessary steps to protect others from harm.

You could save money on your car insurance premiums by:

Which of the following best describes the personal property floater?

Premium discounts may result from:

Donna,who is single and 30-years-old,has received several speeding tickets recently and was shocked by the effect on her auto insurance.Donna drives a 2002 Pontiac Firebird.She is currently not covered by health insurance,has an emergency fund of $25,000,an income of $100,000 per year,and an investment portfolio of $230,000.She is trying to reduce the price of her auto insurance.Which of the following actions is most likely to be help Donna reduce the price of her auto insurance?

Carl and Alexandra purchased a $200,000 homeowners policy for their house in 1988.They have renewed the policy each year since and have replacement coverage.This policy has a $1,000 deductible.Their home now has a replacement value of $275,000.Last week they came home to find a small fire which caused the following damages: Assume Carl and Alexandra have a standard HO-3 policy with personal property covered at 50% and landscaping covered for 10%.How much will the insurance pay for the losses of their personal property and landscaping?

For an extra premium,the HO-3 homeowner's policy pays on the basis of replacement cost for:

An automobile covered under a policy with a $500 collision deductible is damaged in a collision with a fence.It could be repaired for $15,000,replacement cost is $25,000,and the depreciation and physical condition deduction is $5,000.How much will the insurance company pay?

The principle of indemnity states that the insured can be compensated for an amount equal to his economic loss.

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement. -A mobile home is [less | more] likely to suffer a complete loss than a conventional house.

Protection for personal property both at home and away from home is a provision of the homeowners' policy.

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement. -You use a small building on your property to manufacture Widgets.This building [will | will not] be covered by your standard HO policy.

A co-insurance clause will cause insurers to proportionately reduce claims payments unless you carry insurance up to a specific amount,such as 80 percent of the replacement value.