Question 1

Term insurance would pay the face amount of the policy in case of the death of the insured.

Accepted Answer

A) True 
 B)False  True

Question 2

Given the following information and using the tables in the handbook, the total annual premium is: 
Sam Montgomery: territory 5
Classified driver 17
Car age 4 Symbol 5
State has compulsory insurance and the following options:

Accepted Answer

A) $791 
B) $918 
C) $971 
D) $298 
E) None of these 
A) $791 
B) $918 
C) $971 
D) $298 
E) None of these B

Question 3

Collision and comprehensive:

Accepted Answer

A) Only pay the insurer 
B) Only pay the insured 
C) Are compulsory insurance 
D) Have no deductibles 
E) None of these 
A) Only pay the insurer 
B) Only pay the insured 
C) Are compulsory insurance 
D) Have no deductibles 
E) None of these B

Question 4

A premium for fire insurance could be lower than someone else's if:

Accepted Answer

A) Building is wood 
B) Roof is not fire resistant 
C) Building is close to a fire hydrant 
D) Goods within store are flammable 
E) None of these 
A) Building is wood 
B) Roof is not fire resistant 
C) Building is close to a fire hydrant 
D) Goods within store are flammable 
E) None of these

Question 5

Compulsory liability insurance includes bodily injury and property damage.

Accepted Answer

A) True 
 B)False

Question 6

Calculate the optional bodily injury cost for the following: Class 10; optional bodily Injury: 100/300/50

Accepted Answer

A) $94 
B) $144 
C) $108 
D) $187 
E) None of these 
A) $94 
B) $144 
C) $108 
D) $187 
E) None of these

Question 7

A 20-year endowment does not build up any cash value by the end of year 5.

Accepted Answer

A) True 
 B)False

Question 8

Premiums for straight-life insurance are higher than premiums for term insurance.

Accepted Answer

A) True 
 B)False

Question 9

Term insurance:

Accepted Answer

A) Is more expensive than straight-life 
B) Builds up cash value 
C) Pays more than the face amount 
D) Provides temporary protection 
E) None of these 
A) Is more expensive than straight-life 
B) Builds up cash value 
C) Pays more than the face amount 
D) Provides temporary protection 
E) None of these

Question 10

Melissa Toby, age 36, bought a straight-life insurance policy for $80,000. Calculate her annual premium. If after 20 years she no longer pays premiums, what nonforfeiture options are available to her?

Accepted Answer

The answer of Melissa Toby, age 36, bought a straight-life...

Question 11

As a result of coinsurance, the insurance company might pay more than face value.

Accepted Answer

A) True 
 B)False

Question 12

The short rate cancellation table is used if the insured cancels the policy.

Accepted Answer

A) True 
 B)False

Question 13

Which one of the following builds up no cash value?

Accepted Answer

A) Universal life 
B) Straight-life 
C) Term 
D) 20-payment life 
E) None of these 
A) Universal life 
B) Straight-life 
C) Term 
D) 20-payment life 
E) None of these

Question 14

Lowering deductibles for collision will result in increased premiums.

Accepted Answer

A) True 
 B)False

Question 15

The property of Vin's Garage is worth $400,000. Vin has a fire insurance policy of $160,000 that contains an 80% coinsurance clause. What will the insurance company pay on a fire that causes $180,000 of damage? If Vin met the coinsurance, how much would the insurance company pay?

Accepted Answer

@#IMG-DLM& If coinsurance is m

Question 16

Universal life provides whole life protection.

Accepted Answer

A) True 
 B)False

Question 17

Maryville University purchased building insurance for a temporary bookstore for a total annual charge of $1,600. It closed the facility after five months. What is the refund?

Accepted Answer

A) $768 
B) $976 
C) $624 
D) $832 
E) None of these 
A) $768 
B) $976 
C) $624 
D) $832 
E) None of these

Question 18

Jay Miller insured his pizza shop for $200,000 for fire insurance at an annual rate per $100 of $.49. At the end of 10 months, Jay canceled the policy since his pizza shop went out of business. Using the table in the handbook, the refund to Jay is:

Accepted Answer

A) $980 
B) $852.60 
C) $127.40 
D) $186.20 
E) None of these 
A) $980 
B) $852.60 
C) $127.40 
D) $186.20 
E) None of these

Question 19

Al Smith, who lives in territory 5, carries 10/20/5 compulsory liability insurance along with optional collision that has a $300 deductible. Al, who was at fault in an accident, caused $4,000 damage to the other auto as well as $900 damage to his own car. Also, the courts awarded $15,000 and $7,000, respectively, to the two passengers in the other car for personal injuries. Al is responsible to pay a total of:

Accepted Answer

A) $5,000 
B) $5,600 
C) $600 
D) $3,000 
E) None of these 
A) $5,000 
B) $5,600 
C) $600 
D) $3,000 
E) None of these

Question 20

Lee's toy store is worth $400,000 and is insured for $300,000. Assuming an 80% coinsurance clause and a fire that caused $190,000 of damage, the liability of the insurance company is:

Accepted Answer

A) $142,500 
B) $124,500 
C) $187,125 
D) $178,125 
E) None of these 
A) $142,500 
B) $124,500 
C) $187,125 
D) $178,125 
E) None of these

Exam 20: Life, Fire and Auto Insurance

Term insurance would pay the face amount of the policy in case of the death of the insured.

Given the following information and using the tables in the handbook, the total annual premium is: Sam Montgomery: territory 5 Classified driver 17 Car age 4 Symbol 5 State has compulsory insurance and the following options:

Collision and comprehensive:

A premium for fire insurance could be lower than someone else's if:

Compulsory liability insurance includes bodily injury and property damage.

Calculate the optional bodily injury cost for the following: Class 10; optional bodily Injury: 100/300/50

A 20-year endowment does not build up any cash value by the end of year 5.

Premiums for straight-life insurance are higher than premiums for term insurance.

Term insurance:

Melissa Toby, age 36, bought a straight-life insurance policy for $80,000. Calculate her annual premium. If after 20 years she no longer pays premiums, what nonforfeiture options are available to her?

As a result of coinsurance, the insurance company might pay more than face value.

The short rate cancellation table is used if the insured cancels the policy.

Which one of the following builds up no cash value?

Lowering deductibles for collision will result in increased premiums.

The property of Vin's Garage is worth $400,000. Vin has a fire insurance policy of $160,000 that contains an 80% coinsurance clause. What will the insurance company pay on a fire that causes $180,000 of damage? If Vin met the coinsurance, how much would the insurance company pay?

Universal life provides whole life protection.

Maryville University purchased building insurance for a temporary bookstore for a total annual charge of $1,600. It closed the facility after five months. What is the refund?

Jay Miller insured his pizza shop for $200,000 for fire insurance at an annual rate per $100 of $.49. At the end of 10 months, Jay canceled the policy since his pizza shop went out of business. Using the table in the handbook, the refund to Jay is:

Lee's toy store is worth $400,000 and is insured for $300,000. Assuming an 80% coinsurance clause and a fire that caused $190,000 of damage, the liability of the insurance company is:

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