Question 1

Replacement cost for settling property insurance claims is more costly than the actual cash value method.

Accepted Answer

A) True 
 B)False

Question 2

Wind damage occurs to your car costing $3,000 to repair. If you have a $500 deductible for collision and full coverage for comprehensive, what portion of the claim will the insurance company pay?

Accepted Answer

A)   $500
B)   $1,300
C)   $2,500
D)   $3,000
E)   $3,500

Question 3

The purpose of minimum insurance legislation is to

Accepted Answer

A)   risk of injury or death.
B)   possibility of damage, destruction or theft.
C)   third party liability.
D)   A and B are correct.
E)   A, B and C are correct.

Question 4

Defective house wiring is an example of a

Accepted Answer

A)   hazard.
B)   peril.
C)   risk.
D)   speculation.
E)   negligence.

Question 5

Which of the following home insurance policies will have the highest premium?  Policy FormStandardBroadComprehensiveBuildingNamed perilsAll riskAll riskContentsNamed perilsNamed perilsAll risk\begin{array}{c}\begin{array}{lll}	ext{Policy Form}\	ext{Standard}\	ext{Broad}\	ext{Comprehensive}\\end{array}\begin{array}{lll}	ext{Building}\	ext{Named perils}\	ext{All risk}\	ext{All risk}\\end{array}\begin{array}{lll}	ext{Contents}\	ext{Named perils}\	ext{Named perils}\	ext{All risk}\\end{array}\end{array}Policy FormStandardBroadComprehensive​BuildingNamed perilsAll riskAll risk​ContentsNamed perilsNamed perilsAll risk​​

Accepted Answer

A)   Standard
B)   Broad
C)   Comprehensive
D)   All forms will have the same cost.
E)   Broad and Comprehensive are equally expensive

Question 6

Driver classification is a category based on the driver's age, gender, marital status, driving record, and driving habits

Accepted Answer

A) True 
 B)False

Question 7

Your home insurance provides for replacement value for personal property losses. A television is stolen. It cost $1,000 two years ago and has an expected life of 5 years. A comparable television costs $500 today. What amount will the insurance company pay?

Accepted Answer

A)   $100
B)   $150
C)   $200
D)   $350
E)   $500

Question 8

Your geographic location is a major factor in determining the ____________ used to calculate your automobile insurance premiums.

Accepted Answer

A)   driver classification
B)   assigned risk pool
C)   coverage level
D)   legal responsibilities
E)   rating territory

Question 9

The most common method of dealing with risk is to shift, or transfer it to an insurance company or some other organization.

Accepted Answer

A) True 
 B)False

Question 10

Purchasing a technology stock that may or may not increase in price is an example of ___________ risk.

Accepted Answer

A)   speculative
B)   pure
C)   commercial
D)   personal
E)   liability

Question 11

The legal responsibility for the financial cost of another person's losses or injuries is referred to as

Accepted Answer

A)   theft.
B)   robbery.
C)   liability.
D)   assigned risk.
E)   collusion.

Question 12

Home insurance costs are affected most directly by

Accepted Answer

A)   the number of claims in an area.
B)   insurance agents' commission.
C)   government regulations that set premiums.
D)   processing costs of claims.
E)   the profits of the insurance company.

Question 13

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)   legal action against you for an accident.
E)   damage to a neighbor's tree with your car.

Question 14

Which of the following is likely to increase your car insurance premium? 
I. You live in a rural area.
II. You are over 70.
III. You usually carry several passengers.

Accepted Answer

A)   I and II, only
B)   II and III, only
C)   I and III, only
D)   I, II and III
E)   I only

Question 15

________ is an automobile insurance program in which drivers involved in accidents collect medical expenses, lost wages, and related injury costs from their own insurance companies.

Accepted Answer

A)   Medical payments
B)   No-fault insurance
C)   Uninsured motorist's protection
D)   Bodily injury liability
E)   Comprehensive insurance

Question 16

What events are commonly covered in a homeowner's insurance policy?

Accepted Answer

Most home insurance policies include cov...

Question 17

The purpose of a household inventory is to

Accepted Answer

A)   reduce insurance costs.
B)   lower the chance of negligence
C)   obtain personal property floater coverage.
D)   increase liability coverage.
E)   verify owned property.

Question 18

Hazard

Accepted Answer

A)   is the chance that something may be lost.
B)   is the cause of a possible loss.
C)   increases the likelihood of loss through some peril.
D)   is loss possibilities due to negligence resulting in bodily harm or property damage to others.
E)   is a risk that carries a chance of either loss or gain.

Question 19

The purpose of a high-risk pool is to assist people with poor driving records in obtaining automobile insurance coverage.

Accepted Answer

A) True 
 B)False

Question 20

Identify the areas covered by tenants' insurance. 
I. Personal property protection.
II. Additional living expenses.
III. Personal liability.
IV. Replacement value of premises.

Accepted Answer

A)   I, II and III only
B)   I and III only
C)   II, III and IV only
D)   I, II, III and IV
E)   I, II, and IV

Exam 8: Home and Automobile Insurance

Driver classification is a category based on the driver's age, gender, marital status, driving record, and driving habits

Correct Answer
verified

The legal responsibility for the financial cost of another person's losses or injuries is referred to as

Correct Answer
verified

Hazard

Correct Answer
verified

Defective house wiring is an example of a

Correct Answer
verified

Which of the following is likely to increase your car insurance premium? I. You live in a rural area. II. You are over 70. III. You usually carry several passengers.

Correct Answer
verified

________ is an automobile insurance program in which drivers involved in accidents collect medical expenses, lost wages, and related injury costs from their own insurance companies.

Correct Answer
verified

The most common method of dealing with risk is to shift, or transfer it to an insurance company or some other organization.

Correct Answer
verified

Replacement cost for settling property insurance claims is more costly than the actual cash value method.

Correct Answer
verified

Wind damage occurs to your car costing $3,000 to repair. If you have a $500 deductible for collision and full coverage for comprehensive, what portion of the claim will the insurance company pay?

Correct Answer
verified

Your home insurance provides for replacement value for personal property losses. A television is stolen. It cost $1,000 two years ago and has an expected life of 5 years. A comparable television costs $500 today. What amount will the insurance company pay?

Correct Answer
verified

Purchasing a technology stock that may or may not increase in price is an example of ___________ risk.

Correct Answer
verified

What events are commonly covered in a homeowner's insurance policy?

Correct Answer
verified
Most home insurance policies include cov...
View Answer

Identify the areas covered by tenants' insurance. I. Personal property protection. II. Additional living expenses. III. Personal liability. IV. Replacement value of premises.

Correct Answer
verified

Comprehensive coverage would cover financial losses due to

Correct Answer
verified

The purpose of a household inventory is to

Correct Answer
verified

The purpose of a high-risk pool is to assist people with poor driving records in obtaining automobile insurance coverage.

Correct Answer
verified

Your geographic location is a major factor in determining the ____________ used to calculate your automobile insurance premiums.

Correct Answer
verified

The purpose of minimum insurance legislation is to

Correct Answer
verified

Correct Answer
verified

Home insurance costs are affected most directly by

Correct Answer
verified

Exam 8: Home and Automobile Insurance

Driver classification is a category based on the driver's age, gender, marital status, driving record, and driving habits

Correct AnswerverifiedShow Answer

The legal responsibility for the financial cost of another person's losses or injuries is referred to as

Correct AnswerverifiedShow Answer

Hazard

Correct AnswerverifiedShow Answer

Defective house wiring is an example of a

Correct AnswerverifiedShow Answer

Which of the following is likely to increase your car insurance premium? I. You live in a rural area. II. You are over 70. III. You usually carry several passengers.

Correct AnswerverifiedShow Answer

________ is an automobile insurance program in which drivers involved in accidents collect medical expenses, lost wages, and related injury costs from their own insurance companies.

Correct AnswerverifiedShow Answer

The most common method of dealing with risk is to shift, or transfer it to an insurance company or some other organization.

Correct AnswerverifiedShow Answer

Replacement cost for settling property insurance claims is more costly than the actual cash value method.

Correct AnswerverifiedShow Answer

Wind damage occurs to your car costing $3,000 to repair. If you have a $500 deductible for collision and full coverage for comprehensive, what portion of the claim will the insurance company pay?

Correct AnswerverifiedShow Answer

Your home insurance provides for replacement value for personal property losses. A television is stolen. It cost $1,000 two years ago and has an expected life of 5 years. A comparable television costs $500 today. What amount will the insurance company pay?

Correct AnswerverifiedShow Answer

Purchasing a technology stock that may or may not increase in price is an example of ___________ risk.

Correct AnswerverifiedShow Answer

What events are commonly covered in a homeowner's insurance policy?

Correct AnswerverifiedMost home insurance policies include cov...View AnswerShow Answer

Identify the areas covered by tenants' insurance. I. Personal property protection. II. Additional living expenses. III. Personal liability. IV. Replacement value of premises.

Correct AnswerverifiedShow Answer

Comprehensive coverage would cover financial losses due to

Correct AnswerverifiedShow Answer

The purpose of a household inventory is to

Correct AnswerverifiedShow Answer

The purpose of a high-risk pool is to assist people with poor driving records in obtaining automobile insurance coverage.

Correct AnswerverifiedShow Answer

Your geographic location is a major factor in determining the ____________ used to calculate your automobile insurance premiums.

Correct AnswerverifiedShow Answer

The purpose of minimum insurance legislation is to

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Home insurance costs are affected most directly by

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Most home insurance policies include cov...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified