Question 1

Risk reduction generally includes the use of insurance.

Accepted Answer

A) True 
 B)False

Question 2

When shopping for insurance,your goal should be to "buy" what you need and not be "sold" more or less coverage.

Accepted Answer

A) True 
 B)False

Question 3

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

Question 4

Which of the following HO forms is especially written for condominium owners?

Accepted Answer

A) HO-3 
B) HO-4 
C) HO-6 
D) HO-8

Question 5

In administering a risk-management program,you should use the maximum possible loss as a guide for the dollar amount of coverage to buy.

Accepted Answer

A) True 
 B)False

Question 6

The state requirements to prove financial responsibility in case of an auto accident are most often fulfilled through buying ____ insurance.

Accepted Answer

A) homeowner's liability 
B) umbrella liability 
C) auto liability 
D) comprehensive personal liability

Question 7

The actual cash value (of personal property) represents the purchase price of the property less depreciation.

Accepted Answer

A) True 
 B)False

Question 8

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.

Question 9

Buying insurance is the preferable way to handle risk for nearly all potential losses faced.

Accepted Answer

A) True 
 B)False

Exam 10: Managing Property and Liability Risk

Risk reduction generally includes the use of insurance.

When shopping for insurance,your goal should be to "buy" what you need and not be "sold" more or less coverage.

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

Which of the following HO forms is especially written for condominium owners?

In administering a risk-management program,you should use the maximum possible loss as a guide for the dollar amount of coverage to buy.

The state requirements to prove financial responsibility in case of an auto accident are most often fulfilled through buying ____ insurance.

The actual cash value (of personal property) represents the purchase price of the property less depreciation.

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

Buying insurance is the preferable way to handle risk for nearly all potential losses faced.