Deck 10: Protecting Your Property

Question 1

If your insurance company makes a payment to you,subrogation is the right of the company to collect from the person causing the accident or from his/her insurance company.

Answer 1

True

Question 2

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

Answer 2

False

Question 3

Liability insurance generally provides some coverage for legal fees.

Answer 3

True

Question 4

The Principle of Indemnity does NOT apply to life and health insurance.

Question 5

Liability claims may result from alleged negligent acts.

Question 6

Personal property floaters provide increased coverage for jewelry and other collectable items at an additional premium.

Question 7

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

Question 8

Other-insurance clauses help prevent the violation of the principle of indemnity.

Question 9

Actual cash value provides coverage at the current market value of your property.

Question 10

Property inventories are important to identify insurance needs and to substantiate claims.

Question 11

You would be considered to be negligent when you,a dependent,or another named insured's action causes harm or property loss.

Question 12

The principle of indemnity states that the insured can be compensated for an amount equal to his economic loss.

Question 13

The terms "perils" and "losses" refer to the same thing.

Question 14

Antiques,collections,and boats are adequately protected under a standard homeowner's policy.

Question 15

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

Question 16

A peril is a cause of loss.

Question 17

Fire is an example of a hazard.

Question 18

Floods are specifically defined in homeowner's policies.

Question 19

The principle of indemnity generally limits the amount that the insured may collect to the actual cash value of the property.

Question 20

Actual cash value is defined as replacement cost minus depreciation.

Question 21

Nancy's house has been completely destroyed by fire.Prior to the accident,the house had a value of $100,000.Nancy had two separate policies totaling $60,000 each.She may collect $60,000 from each insurance company.

Question 22

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

Question 23

Earthquakes are covered under most homeowners policies.

Question 24

A coinsurance clause will cause insurers to proportionately reduce claims payments unless you carry insurance up to a specific amount,such as 80 percent of the replacement value.

Question 25

The Right of Subrogation allows the insured to get reimbursed for claims paid.

Question 26

A house with a replacement value of $110,000 is currently insured for $90,000.The house has suffered a $15,000 loss from windstorm damage.The insurance company will pay the full $15,000 less the deductible.

Question 27

While you were away on your summer vacation,raccoons took up residence in your attic.They did $5,000 damage.Your H0-2 policy will cover this loss.

Question 28

HO coinsurance requires the insured to carry insurance protection equal to the market value of the house.

Question 29

Covered liability perils do not include claims for libel,slander,or character defamation.

Question 30

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

Question 31

As a tenant,you would purchase a HO-3 policy.

Question 32

Replacement cost and actual cash value is the same thing.

Question 33

While you were away on winter vacation,there was a severe snowstorm that caused your roof to cave in causing a $20,000 loss.Your H0-2 policy will cover this loss.

Question 34

Connie rented a hotel room while on vacation.If someone breaks into her room,her HO-4 policy will cover her stolen property.

Question 35

Protection for personal property both at home and away from home is a provision of the homeowners' policy.

Question 36

Your homeowner's policy will pay for damage to the neighbor's property when your 10 year old son throws a rock through her picture window.

Question 37

You will insure your house for $90,000.The premium on an HO-3 policy will be greater than that of an HO-2 policy.

Question 38

HO-4 and HO-6 are for renters and owners of condominiums,respectively.

Question 39

The HO-3 form is a good policy for first-time buyer owners because it is a named perils policy.

Question 40

An HO-1 policy lists more perils for which you are insured than an HO-3 does.

Question 41

State financial responsibility laws require only auto liability insurance.

Question 42

Internal limits are normally specified in the homeowners' insurance contract for some categories of personal property.

Question 43

The no-fault automobile insurance movement has had a major effect on auto insurance premiums.

Question 44

The insurance company will provide defense for a covered person against both civil and criminal charges involving her motor vehicle.

Question 45

Collision coverage would pay for damages to your car if a tree falls on it.

Question 46

A $100,000/$300,000 bodily injury liability automobile policy could pay up to $100,000 to one person or up to $300,000 to several people seeking damages.

Question 47

The type of car you drive has little effect on your auto insurance premiums.

Question 48

Automobile medical payments insurance normally contains an indemnity clause.

Question 49

The named insured and her passengers would be covered under automobile medical payments insurance.

Question 50

Uninsured motorist protection usually provides protection to your car if a hit-and-run incident occurs.

Question 51

A personal property floater and a personal liability umbrella policy offer similar coverage.

Question 52

Automobile liability claims could potentially be more costly to you than car damage claims.

Question 53

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

Question 54

Replacement cost coverage is available for renters but requires an extra premium.

Question 55

To save premium costs,one should decrease her deductible and liability coverage on a homeowners' policy.

Question 56

Financial responsibility laws in most states are high enough to adequately meet one's auto liability needs.

Question 57

A pure no-fault system insurance would not pay for medical expenses.

Question 58

Careful drivers have limited need for liability protection,because they are not likely to be at fault in an accident.

Question 59

A rental car could be a covered auto under a personal auto policy liability section.

Question 60

The premiums for homeowners' insurance are based on size of deductible,internal limits,and standard coverage.

Question 61

Getting married will lower your auto insurance premiums.

Question 62

The asset most likely to be specifically itemized in a property insurance endorsement is

A) sofa.
B) clothing.
C) jewelry.
D) garden equipment.
E) all of these.

Question 63

A personal liability umbrella policy typically includes coverage for auto related liability losses in excess of the limits purchased in a personal auto policy.

Question 64

The minimum limit for personal umbrella policies is generally $1,000,000.

Question 65

Your standard HO policy will not include coverage for damage done by

A) flood.
B) windstorm.
C) falling objects.
D) wind.
E) theft.

Question 66

Section I of a homeowner's insurance policy covers the insured's dwelling unit,accompanying structures,and personal liaiblity.

Question 67

Collision insurance pays for damage to your automobile regardless of who is at fault.

Question 68

Some common liability risks include:

A) driving a car
B) entertaining guests at home
C) being careless in performing professional duties
D) all of the above

Question 69

The basic principles of property and liability insurance pertain to:

A) types of exposure
B) the principles of indemnity
C) coinsurance
D) all of the above

Question 70

The federal government subsidizes the flood insurance program.

Question 71

A captive agent represents many insurance companies.

Question 72

The best place to buy automobile insurance is your insurance agent.

Question 73

Uninsured motorist coverage covers passengers in your car from losses caused by your negligence.

Question 74

Section II of a homeowner's insurance policy covers personal property and personal liability.

Question 75

All property insurance companies require you to show the following when making a claim:

A) Proof of loss
B) Personal property inventory
C) Values at the time of inventory
D) All of the above.

Question 76

Age of home affects insurance premiums the most.

Question 77

The advisable dollar limit for any one auto accident is $250,000.

Question 78

Section I of a homeowner's insurance policy covers medical payments.

Question 79

One should never admit fault at the scene of an accident.

Question 80

The personal liability umbrella policy typically includes coverage for liability losses that are in excess of the limits purchased in the comprehensive personal liability coverage provided in the homeowners' policy.