Exam 10: Managing Property and Liability Risk

Auto insurance agents need to be informed when a student keeps a car at college.

Steep staircases with no lighting are an example of a

Your auto liability coverage will usually protect you for liability claims when you drive a rental car.

A person who leaves his or her insured car running when he or she runs into the convenience store provides an example of a ____ hazard.

George and Kelly have a renter's policy with $1,000 per person no-fault medical payments coverage.Following a party at their home,Brian,one of their guests,fell on the stairs and broke his ankle.How much of the $1,850 medical bills will George and Kelly's renter's policy pay?

The additional cost of increasing the liability coverage on homeowner's policies is substantial.

Most of the HO forms of homeowner's insurance policies provide all-risk protection on the house and named-peril protection on the personal property.

Lonnie and Paula have a homeowner's policy with $75,000 coverage and a $250 deductible.Their home recently suffered extensive fire damage in the amount of $50,000.Assuming the replacement value of the home was $85,000,how much will the insurance company pay on this loss?

Comprehensive automobile insurance protects against property damage losses caused by perils.Which one of the following is not a covered peril?

Risk avoidance is always a practical way of handling risk.

The homeowner's policy written for condominium owners does not provide which of the following coverages?

For most personal property,replacement cost will be higher than actual cash value.

Most insurance underwriting is done by the insurance company rather than the insurance agent.

One is more likely to need to raise the standard 50 percent limit on personal property coverage when he or she selects replacement-cost protection rather than actual-cash-value protection.

In order for a potential loss to be insurable it must be

Dana Garcia has a renter's policy with a maximum limit for personal property of $30,000.When her apartment suffered fire damage,$15,000 of her personal property was destroyed.The insurance would pay no more than ____ in this case.

A provision of an insurance policy that is purchased separately from the basic policy and that provides additional benefits at additional costs called a(n)

The maximum possible loss that can occur helps one

Robert and Louisa have identified the following potential loss exposures,but they are not sure whether they should purchase insurance to reduce these risks: When Robert and Louisa prioritize their insurance choices,____ would be categorized as important,but not necessary. 1)Loss of their health,which could cause extensive medical bills and loss of income 2)Loss to their car,which would cause automobile repair or replacement 3)Liability claims related to their car,which could require them to pay for other person's losses

Deductibles are requirements that the insured pay an initial portion of any loss.