Exam 10: Managing Property and Liability Risk

Which of the following perils is not covered under any of the standard homeowner's forms?

When considering insurance,loss frequency is more important than loss severity.

As reported in the newspaper,an insurance company paid a claim for a dent on a car roof after a man barbecuing steaks accidently dropped one over his balcony and watched it fall 17 floors onto the car.Assuming the car belonged to someone other than the chef,which of the chef's insurance coverage would have covered the dented roof?

Umbrella liability insurance policies provide for high dollar amounts of coverage over and above the basic policies.

The insurance company carries the burden of proof whenever a property or liability loss occurs.

Homeowner's policies may include a clause that automatically raises the policy coverage amount each year to keep pace with inflationary increases in the cost of replacing the dwelling.

Insurance coverage may be denied if policy conditions are not met.

Both collision and comprehensive coverage are usually written with deductibles.

Homeowner's insurance can pay for additional expenses such as temporary lodging and food as well as for repairing or replacing property.

Property damage liability claims tend to be considerably larger than bodily injury liability claims in auto insurance.

The process of deciding which insurance applicants to insure is called

Historically,homeowner's insurance paid only the actual cash value of property damaged or destroyed.

When you sign a release,you are affirming

Many people do not examine their insurance policies until they suffer a loss.

An umbrella liability policy provides

Risk management is the process of identifying and evaluating situations involving speculative risk to determine and implement the appropriate means for its management.

Amy Lou Young purchased a health insurance policy with a $500 deductible and 40 percent coinsurance.If Amy Lou incurs $6,500 in covered medical expenses,her policy will pay

All insurance is sold and serviced through insurance agents.

Replacement-cost protection is an option available on some homeowner's insurance policies (including the renter's form) that pays the full replacement cost of any personal property.

Floater policies provide named-peril protection for movable personal property.