Question 1

Automobile physical damage insurance provides protection from losses due to damage to your car from collision,theft,and other perils.

Accepted Answer

A) True 
 B)False

Question 2

Jennifer and Chad have a homeowner's policy with contents replacement-cost coverage for personal property up to 50 percent of the insurance on their home.What will the insurance company pay for their stolen property under the following situation?
Insured value of house
$90,000
Deductible
$500
Actual cash value of stolen property
$20,000
Replacement value of stolen property
$35,000
​

Accepted Answer

A)  ​$19,500 
B)  ​$34,500 
C)  ​$35,000 
D)  ​$44,500 
A)  ​$19,500 
B)  ​$34,500 
C)  ​$35,000 
D)  ​$44,500

Question 3

Insurance can be purchased for a speculative risk but not for a pure risk.

Accepted Answer

A) True 
 B)False

Question 4

Individuals who enter into,change and cancel insurance policies on behalf of an insurance company that they represent are referred to as insurance

Accepted Answer

A)  ​brokers. 
B)  ​agents. 
C)  ​facilitators. 
D)  ​underwriters 
A)  ​brokers. 
B)  ​agents. 
C)  ​facilitators. 
D)  ​underwriters

Question 5

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

Accepted Answer

A) True 
 B)False

Question 6

Risk retention would be most appropriate in which of the following cases?​

Accepted Answer

A)  ​Collision coverage on a $14,000 car 
B)  ​Coverage for loss of a contact lens 
C)  ​Medical expenses for a healthy young adult 
D)  ​Liability coverage for a middle-income individual 
A)  ​Collision coverage on a $14,000 car 
B)  ​Coverage for loss of a contact lens 
C)  ​Medical expenses for a healthy young adult 
D)  ​Liability coverage for a middle-income individual

Question 7

An umbrella liability policy provides​

Accepted Answer

A)  ​flood insurance. 
B)  ​additional liability protection over and above your auto insurance limits,only. 
C)  ​additional liability protection over and above your homeowner's insurance limits,only. 
D)  ​additional liability protection over and above any other liability insurance you carry. 
A)  ​flood insurance. 
B)  ​additional liability protection over and above your auto insurance limits,only. 
C)  ​additional liability protection over and above your homeowner's insurance limits,only. 
D)  ​additional liability protection over and above any other liability insurance you carry.

Question 8

It is in your best interest to sign an insurance release as soon as possible after a bodily injury loss has occurred.

Accepted Answer

A) True 
 B)False

Question 9

Fortuitous means unexpected both in terms of timing and magnitude.

Accepted Answer

A) True 
 B)False

Question 10

Independent agents typically represent more than one insurance company.

Accepted Answer

A) True 
 B)False

Question 11

Frank tried to enter the Central Expressway and caused a wreck.He had automobile insurance with limits of 30/50/15.What is the maximum this insurance policy would pay for the total of bodily injury liability claims in the accident?
$30,000

Accepted Answer

A)  $15,000 
B)  ​$30,000 
C)  ​$50,000 
D)  ​$65,000 
A)  $15,000 
B)  ​$30,000 
C)  ​$50,000 
D)  ​$65,000

Question 12

An insurance policy is a contract between the person buying insurance and the insurance company.

Accepted Answer

A) True 
 B)False

Question 13

People who are uncomfortable with risk and who avoid it whenever they can are using the approach of​

Accepted Answer

A)  ​risk retention. 
B)  ​risk transfer. 
C)  ​risk avoidance. 
D)  ​loss control. 
A)  ​risk retention. 
B)  ​risk transfer. 
C)  ​risk avoidance. 
D)  ​loss control.

Question 14

The principle of indemnity is very difficult to apply to ____ insurance.

Accepted Answer

A)  ​auto 
B)  ​homeowner's 
C)  ​health 
D)  ​life 
A)  ​auto 
B)  ​homeowner's 
C)  ​health 
D)  ​life

Question 15

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.

Accepted Answer

A) True 
 B)False

Question 16

____ insurance is required in most states.

Accepted Answer

A)  ​Homeowner's 
B)  ​Automobile 
C)  ​Health 
D)  ​Umbrella liability 
A)  ​Homeowner's 
B)  ​Automobile 
C)  ​Health 
D)  ​Umbrella liability

Question 17

Melvin has an auto insurance policy that includes both collision and comprehensive coverage.He has a $250 deductible on his collision coverage and a $100 deductible on his comprehensive coverage.His car has a book value of $7,500 when he is in a one-car accident with a tree.The car suffers damages of $5,000.How much will Melvin's insurance company pay for this repair work?​

Accepted Answer

A)  ​$4,750 
B)  ​$4,900 
C)  ​$7,400 
D)  ​$7,250 
A)  ​$4,750 
B)  ​$4,900 
C)  ​$7,400 
D)  ​$7,250

Question 18

You should not keep the documentation for your personal property

Accepted Answer

A)  ​at home. 
B)  ​in a safe-deposit box. 
C)  ​with a relative. 
D)  ​at work. 
A)  ​at home. 
B)  ​in a safe-deposit box. 
C)  ​with a relative. 
D)  ​at work.

Question 19

What is the first step in the risk-management process?​

Accepted Answer

A)  ​Evaluate the potential losses that might result. 
B)  ​Administer the risk-management program. 
C)  ​Identify sources of risk. 
D)  ​Decide on the best way(s)to handle risk and losses. 
A)  ​Evaluate the potential losses that might result. 
B)  ​Administer the risk-management program. 
C)  ​Identify sources of risk. 
D)  ​Decide on the best way(s)to handle risk and losses.

Question 20

Personal injury protection pays the driver and passengers in the covered automobile without regard to fault.

Accepted Answer

A) True 
 B)False

Automobile physical damage insurance provides protection from losses due to damage to your car from collision,theft,and other perils.

Insurance can be purchased for a speculative risk but not for a pure risk.

Individuals who enter into,change and cancel insurance policies on behalf of an insurance company that they represent are referred to as insurance

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

Risk retention would be most appropriate in which of the following cases?

An umbrella liability policy provides

It is in your best interest to sign an insurance release as soon as possible after a bodily injury loss has occurred.

Fortuitous means unexpected both in terms of timing and magnitude.

Independent agents typically represent more than one insurance company.

Frank tried to enter the Central Expressway and caused a wreck.He had automobile insurance with limits of 30/50/15.What is the maximum this insurance policy would pay for the total of bodily injury liability claims in the accident? $30,000

An insurance policy is a contract between the person buying insurance and the insurance company.

People who are uncomfortable with risk and who avoid it whenever they can are using the approach of

The principle of indemnity is very difficult to apply to ____ insurance.

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.

____ insurance is required in most states.

You should not keep the documentation for your personal property

What is the first step in the risk-management process?

Personal injury protection pays the driver and passengers in the covered automobile without regard to fault.

Understanding Personal Finance

Career Planning

Financial Statements,tools,and Budgets

Managing Income Taxes

Managing Checking and Savings Accounts

Building and Maintaining Good Credit

Credit Cards and Consumer Loans

Vehicles and Other Major Purchases

Obtaining Affordable Housing

Managing Health Expenses

Life Insurance Planning

Investment Fundamentals

Investing in Stocks and Bonds

Investing Through Mutual Funds

Real Estate and High-Risk Investments

Retirement Planning

Filters

Exam 10: Managing Property and Liability Risk

Automobile physical damage insurance provides protection from losses due to damage to your car from collision,theft,and other perils.

Insurance can be purchased for a speculative risk but not for a pure risk.

Individuals who enter into,change and cancel insurance policies on behalf of an insurance company that they represent are referred to as insurance

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

Risk retention would be most appropriate in which of the following cases?​

An umbrella liability policy provides​

It is in your best interest to sign an insurance release as soon as possible after a bodily injury loss has occurred.

Fortuitous means unexpected both in terms of timing and magnitude.

Independent agents typically represent more than one insurance company.

Frank tried to enter the Central Expressway and caused a wreck.He had automobile insurance with limits of 30/50/15.What is the maximum this insurance policy would pay for the total of bodily injury liability claims in the accident? $30,000

An insurance policy is a contract between the person buying insurance and the insurance company.

People who are uncomfortable with risk and who avoid it whenever they can are using the approach of​

The principle of indemnity is very difficult to apply to ____ insurance.

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.

____ insurance is required in most states.

You should not keep the documentation for your personal property

What is the first step in the risk-management process?​

Personal injury protection pays the driver and passengers in the covered automobile without regard to fault.

Understanding Personal Finance

Career Planning

Financial Statements,tools,and Budgets

Managing Income Taxes

Managing Checking and Savings Accounts

Building and Maintaining Good Credit

Credit Cards and Consumer Loans

Vehicles and Other Major Purchases

Obtaining Affordable Housing

Managing Health Expenses

Life Insurance Planning

Investment Fundamentals

Investing in Stocks and Bonds

Investing Through Mutual Funds

Real Estate and High-Risk Investments

Retirement Planning

Filters

Risk retention would be most appropriate in which of the following cases?

An umbrella liability policy provides

People who are uncomfortable with risk and who avoid it whenever they can are using the approach of

What is the first step in the risk-management process?