Exam 10: Protecting Your Property

The automobile liability insurance policy covers the insured and residents of his/her household when driving an owned automobile.

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

Homeowner policy forms are fairly standardized from one company to another.

INSTRUCTIONS: 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. -An insurance adjustor is working for the [insurance company | claimant].

Homeowners' insurance will cover which of the following?

INSTRUCTIONS: 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. -Your house has a replacement value of $120,000.Your HO policy has an 80% co-insurance clause.In order to receive full compensation if your house is totally destroyed,you must carry insurance for [$96,000 | $120,000].

Which of the following is likely to result in an auto insurance discount?

State financial responsibility laws require only auto liability insurance.

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?

INSTRUCTIONS: 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. -Marilee has insurance (which does not expire for another six months)on a house she recently sold to Claudia.Now the house has been flattened by a tornado.Marilee [can | cannot] collect on her policy.

INSTRUCTIONS: 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. -Umbrella liability insurance is more likely to be needed by [higher | lower] income persons.

Like standard homeowners' policies,a renters' policy liability coverage includes coverage away from home.

INSTRUCTIONS: 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 personal liability umbrella liability policy is designed to [replace | supplement] HO and car liability coverage.

Factors that affect home insurance costs include:

Which Homeowners' policy is best suited for a resident of a rented apartment to cover that person's personal property?

Property insurance is meant to protect property owners from two basic types of exposures,physical loss of property and loss through depreciation.

INSTRUCTIONS: 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. -The Principle of [Indemnity | Peril] states that the insured may not be compensated by the insurance company in an amount exceeding the insured's economic loss.

Which of the following losses is most likely to be covered under your auto liability insurance?

Some common liability risks include:

A written inventory of personal property is required by insurance companies for property insured under the unscheduled general contents coverage.