Question 1

Collision insurance covers damages to a car in a natural disaster.

Accepted Answer

A) True 
 B)False  False

Question 2

An insurance broker is an agent of an insurer.

Accepted Answer

A) True 
 B)False  False

Question 3

Henry works as an assembly line worker at MM Corporation. Two weeks back, he suffered multiple fractures while trying to repair a block in the machinery. The doctors have advised him to take two months of rest to recuperate from this accident. However, Henry is reassured that the ________ that he is eligible for will provide him with a monthly income until he is fit to return to work.

Accepted Answer

A)  life insurance 
B)  disability insurance 
C)  health insurance 
D)  homeowner's policy 
A)  life insurance 
B)  disability insurance 
C)  health insurance 
D)  homeowner's policy B

Question 4

________ is a requirement that a person who purchases insurance has a personal stake in the insured item or person.

Accepted Answer

A)  Delivery of possession 
B)  Endorsement 
C)  Adverse possessory interest 
D)  Insurable interest 
A)  Delivery of possession 
B)  Endorsement 
C)  Adverse possessory interest 
D)  Insurable interest

Question 5

Under the replacement cost insurance, an insurer has the right to either pay the insured for the loss or pay to have the property restored.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following is an insurer's duty?

Accepted Answer

A)  to pay back the insured's money on demand 
B)  to pay back the premiums paid by the insured upon an endorsement of insurance 
C)  to pay legitimate claims up to the insurance policy limits 
D)  to pay interest for the premiums paid by insured on a monthly or yearly basis 
A)  to pay back the insured's money on demand 
B)  to pay back the premiums paid by the insured upon an endorsement of insurance 
C)  to pay legitimate claims up to the insurance policy limits 
D)  to pay interest for the premiums paid by insured on a monthly or yearly basis

Question 7

The suicide clause is a clause that states that insurance proceedings will not be paid in case of a suicide at any time during the policy's validity.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following statements is true of a life insurance?

Accepted Answer

A)  The insurable interest need not exist at the time of insurance. 
B)  The insurable interest need not exist at the time of death or loss. 
C)  The beneficiary and the insured cannot be the same person. 
D)  The beneficiary and the insured must be bound by a relationship of blood. 
A)  The insurable interest need not exist at the time of insurance. 
B)  The insurable interest need not exist at the time of death or loss. 
C)  The beneficiary and the insured cannot be the same person. 
D)  The beneficiary and the insured must be bound by a relationship of blood.

Question 9

________ is a form of property insurance that insures an automobile from loss or damage due to causes other than collision.

Accepted Answer

A)  Omnibus insurance 
B)  Comprehensive insurance 
C)  Coinsurance clause 
D)  No-fault automobile insurance 
A)  Omnibus insurance 
B)  Comprehensive insurance 
C)  Coinsurance clause 
D)  No-fault automobile insurance

Question 10

What are the duties of an insured and insurer?

Accepted Answer

The parties to an insurance contract are

Question 11

Lienholders cannot purchase title insurance on a property on which they have a lien.

Accepted Answer

A) True 
 B)False

Question 12

What is the importance of title insurance in real property?

Accepted Answer

Owners of real property can purchase tit

Question 13

The ________ is a duty of the insurer to protect the insured against lawsuits or legal proceedings that involve a claim within the coverage of the insurance policy.

Accepted Answer

A)  duty of strict liability 
B)  duty to pay 
C)  duty of reasonable care 
D)  duty to defend 
A)  duty of strict liability 
B)  duty to pay 
C)  duty of reasonable care 
D)  duty to defend

Question 14

Helen has a $40,000 automobile collision policy with a $750 deductible. If her car is involved in an accident costing her $15,000 to repair the damages, ________ is the amount she will have to pay to receive coverage for the damages from the insurer.

Accepted Answer

A)  $750 
B)  $39,250 
C)  $40,000 
D)  $14,250 
A)  $750 
B)  $39,250 
C)  $40,000 
D)  $14,250

Question 15

Hillary had purchased a term life insurance policy and had nominated her mother as the beneficiary, while William, her colleague, had a universal life insurance and had nominated himself as the beneficiary. Hillary and William recently got married and wish to nominate each other as beneficiaries in their individual life insurance policies. In the context of the given scenario, which of the following statements is true?

Accepted Answer

A)  Hillary and William will have to purchase two new policies to nominate each other as beneficiaries. 
B)  Hillary and William will have to seek an endorsement to make the requisite changes in their current individual life insurance policies. 
C)  Hillary will be able to nominate William as the beneficiary, but William cannot do so because he did not enlist a beneficiary earlier. 
D)  William will have to nominate both Hillary and her mother as beneficiaries for his insurance policy because existing beneficiaries cannot be denied coverage. 
A)  Hillary and William will have to purchase two new policies to nominate each other as beneficiaries. 
B)  Hillary and William will have to seek an endorsement to make the requisite changes in their current individual life insurance policies. 
C)  Hillary will be able to nominate William as the beneficiary, but William cannot do so because he did not enlist a beneficiary earlier. 
D)  William will have to nominate both Hillary and her mother as beneficiaries for his insurance policy because existing beneficiaries cannot be denied coverage.

Question 16

What is the copay clause in an insurance policy?

Accepted Answer

A)  a clause in a life insurance contract that provides no coverage if the insured commits suicide before a stipulated date 
B)  a clause in an insurance policy that expressly stipulates the risks that are not covered by the insurance policy 
C)  a clause that prevents insurers from contesting statements made by insureds in applications after the passage of a stipulated number of years 
D)  a clause that requires the insured to pay a percentage of an insured loss along with the remainder being paid by the insurer 
A)  a clause in a life insurance contract that provides no coverage if the insured commits suicide before a stipulated date 
B)  a clause in an insurance policy that expressly stipulates the risks that are not covered by the insurance policy 
C)  a clause that prevents insurers from contesting statements made by insureds in applications after the passage of a stipulated number of years 
D)  a clause that requires the insured to pay a percentage of an insured loss along with the remainder being paid by the insurer

Question 17

Automobile liability insurance covers damages that an insured causes to third parties.

Accepted Answer

A) True 
 B)False

Question 18

A personal articles floater provides coverage for loss or damage to the articles while traveling.

Accepted Answer

A) True 
 B)False

Question 19

A(n) ________ is a clause in an insurance policy that provides that insurance proceeds are payable only after the insured has paid a specified amount toward the damage or loss.

Accepted Answer

A)  incontestability clause 
B)  coinsurance clause 
C)  exclusions from coverage clause 
D)  deductible clause 
A)  incontestability clause 
B)  coinsurance clause 
C)  exclusions from coverage clause 
D)  deductible clause

Question 20

Personal injury is not covered under a standard fire insurance policy.

Accepted Answer

A) True 
 B)False

Exam 50: Insurance

Collision insurance covers damages to a car in a natural disaster.

An insurance broker is an agent of an insurer.

________ is a requirement that a person who purchases insurance has a personal stake in the insured item or person.

Under the replacement cost insurance, an insurer has the right to either pay the insured for the loss or pay to have the property restored.

Which of the following is an insurer's duty?

The suicide clause is a clause that states that insurance proceedings will not be paid in case of a suicide at any time during the policy's validity.

Which of the following statements is true of a life insurance?

________ is a form of property insurance that insures an automobile from loss or damage due to causes other than collision.

What are the duties of an insured and insurer?

Lienholders cannot purchase title insurance on a property on which they have a lien.

What is the importance of title insurance in real property?

The ________ is a duty of the insurer to protect the insured against lawsuits or legal proceedings that involve a claim within the coverage of the insurance policy.

Helen has a $40,000 automobile collision policy with a $750 deductible. If her car is involved in an accident costing her $15,000 to repair the damages, ________ is the amount she will have to pay to receive coverage for the damages from the insurer.

What is the copay clause in an insurance policy?

Automobile liability insurance covers damages that an insured causes to third parties.

A personal articles floater provides coverage for loss or damage to the articles while traveling.

A(n) ________ is a clause in an insurance policy that provides that insurance proceeds are payable only after the insured has paid a specified amount toward the damage or loss.

Personal injury is not covered under a standard fire insurance policy.

Legal Heritage and the Digital Age

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Product and Strict Liability

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Nature of Traditional and E-Contracts

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Genuineness of Assent and Undue Influence

Statute of Frauds and Equitable Exceptions

Third-Party Rights and Discharge

Remedies for Breach of Traditional and E-Contracts

Digital Law and E-Commerce

Formation of Sales and Lease Contracts

Title to Goods and Risk of Loss

Remedies for Breach of Sales and Lease Contracts

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Creation of Negotiable Instruments

Holder in Due Course and Transferability

Liability, Defenses, and Discharge

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Ethics and Social Responsibility of Business

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