Question 1

Starting a small business that may or may not succeed is an example of speculative risk.

Accepted Answer

A) True 
 B)False

Question 2

Under the ____________ method for settling claims you receive the full cost of repairing or replacing a damaged or lost item and depreciation is not considered.

Accepted Answer

A)  replacement value
B)  actual cash value
C)  umbrella
D)  endorsement
E)  personal articles endorsementF) A) and C)
G) A) and D)

Question 3

Personal property refers to building and other structures covered by homeowner's insurance.

Accepted Answer

A) True 
 B)False

Question 4

Vicarious liability refers to the failure to take ordinary or reasonable care in a situation.

Accepted Answer

A) True 
 B)False

Question 5

High winds cause damage to trees, shrubs, and other plants.This insurance claim would be covered under the ____________ component of homeowner's insurance.

Accepted Answer

A)  additional living expenses
B)  personal property
C)  building and other structures
D)  personal liability
E)  property damageF) B) and E)
G) A) and B)

Question 6

Which of the following are not covered by tenant's insurance?

Accepted Answer

A)  medical expenses for injuries to visitors
B)  fire damage of the building's roof
C)  additional living expenses
D)  accidental damage to the property of others
E)  cost of legal action due to personal liabilityF) A) and C)
G) A) and B)

Question 7

Liability risk

Accepted Answer

A)  carries a chance of either loss or gain, such as gambling or investing in a new business.
B)  is the cause of a possible loss.
C)  increases the likelihood of loss through some peril.
D)  are the uncertainties of direct or indirect losses to property due to fire, windstorms, accidents, theft, and other hazards.
E)  is loss possibilities due to negligence resulting in bodily harm or property damage to others.F) A) and B)
G) D) and E)

Question 8

The requirement for a minimum level of home insurance coverage refers to which of the following?

Accepted Answer

A)  Deductible
B)  Specified perils
C)  Endorsement
D)  Co-insurance
E)  BasicF) B) and E)
G) B) and D)

Question 9

The purpose of minimum insurance legislation is to

Accepted Answer

A)  risk of injury or death.
B)  possibility of damage, destruction or theft.
C)  third party liability.
D)  A and B are correct.
E)  A, B and C are correct.F) D) and E)
G) B) and C)

Question 10

____________ provides coverage for the risk of financial loss due to legal expenses, medical expenses, lost wages, and other expenses associated with injuries caused by an automobile accident for which you were responsible.

Accepted Answer

A)  Medical payments
B)  No-fault insurance
C)  Uninsured motorist's protection
D)  Bodily injury liability
E)  Comprehensive insuranceF) D) and E)
G) A) and B)

Question 11

Personal articles endorsement is an additional property insurance to cover the damage or loss of a specific item of high value.

Accepted Answer

A) True 
 B)False

Question 12

Risk management is an organized strategy for protecting assets and people.

Accepted Answer

A) True 
 B)False

Question 13

The homeowners' pets are included in the coverage provided by the homeowners insurance.

Accepted Answer

A) True 
 B)False

Question 14

The additional living expenses component of a home insurance policy is designed to

Accepted Answer

A)  pay for temporary housing while your home is repaired.
B)  cover damage to property while away from home.
C)  reimburse a homeowner for damage done by a visitor.
D)  pay for medical expenses of people injured on your property.
E)  pay for repairs caused by fire or other hazards.F) D) and E)
G) None of the above

Question 15

Which of the following would be covered by a home insurance policy?

Accepted Answer

A)  earthquake damage
B)  flooding
C)  brush fires
D)  wind damage to your roof
E)  theft of business supplies from your officeF) C) and E)
G) None of the above

Question 16

Personal risks, property risks, and liability risks are types of speculative risks.

Accepted Answer

A) True 
 B)False

Question 17

An umbrella policy is designed to cover

Accepted Answer

A)  expensive personal property.
B)  additional buildings on your property.
C)  property when traveling away from home.
D)  flood damage
E)  major personal liability suits.F) A) and B)
G) C) and D)

Question 18

Hazard

Accepted Answer

A)  is the chance that something may be lost.
B)  is the cause of a possible loss.
C)  increases the likelihood of loss through some peril.
D)  is loss possibilities due to negligence resulting in bodily harm or property damage to others.
E)  is a risk that carries a chance of either loss or gain.F) A) and B)
G) C) and D)

Question 19

The legal responsibility for the financial cost of another person's losses or injuries is referred to as

Accepted Answer

A)  theft.
B)  robbery.
C)  liability.
D)  assigned risk.
E)  collusion.F) A) and D)
G) B) and D)

Question 20

The ____________ coverage of a home insurance policy would cover accidental damage to another person's property by a member of your family.

Accepted Answer

A)  voluntary property damages
B)  personal property
C)  medical payments
D)  additional living expenses
E)  personal liabilityF) C) and E)
G) A) and E)

Exam 8: Home and Automobile Insurance

____________ provides coverage for the risk of financial loss due to legal expenses, medical expenses, lost wages, and other expenses associated with injuries caused by an automobile accident for which you were responsible.

Correct AnswerverifiedShow Answer

Which of the following are not covered by tenant's insurance?

Correct AnswerverifiedShow Answer

Which of the following would be covered by a home insurance policy?

Correct AnswerverifiedShow Answer

Liability risk

Correct AnswerverifiedShow Answer

Hazard

Correct AnswerverifiedShow Answer

Under the ____________ method for settling claims you receive the full cost of repairing or replacing a damaged or lost item and depreciation is not considered.

Correct AnswerverifiedShow Answer

High winds cause damage to trees, shrubs, and other plants.This insurance claim would be covered under the ____________ component of homeowner's insurance.

Correct AnswerverifiedShow Answer

Personal articles endorsement is an additional property insurance to cover the damage or loss of a specific item of high value.

Correct AnswerverifiedShow Answer

The legal responsibility for the financial cost of another person's losses or injuries is referred to as

Correct AnswerverifiedShow Answer

An umbrella policy is designed to cover

Correct AnswerverifiedShow Answer

The requirement for a minimum level of home insurance coverage refers to which of the following?

Correct AnswerverifiedShow Answer

Personal property refers to building and other structures covered by homeowner's insurance.

Correct AnswerverifiedShow Answer

The ____________ coverage of a home insurance policy would cover accidental damage to another person's property by a member of your family.

Correct AnswerverifiedShow Answer

Risk management is an organized strategy for protecting assets and people.

Correct AnswerverifiedShow Answer

The homeowners' pets are included in the coverage provided by the homeowners insurance.

Correct AnswerverifiedShow Answer

Vicarious liability refers to the failure to take ordinary or reasonable care in a situation.

Correct AnswerverifiedShow Answer

The purpose of minimum insurance legislation is to

Correct AnswerverifiedShow Answer

The additional living expenses component of a home insurance policy is designed to

Correct AnswerverifiedShow Answer

Starting a small business that may or may not succeed is an example of speculative risk.

Correct AnswerverifiedShow Answer

Personal risks, property risks, and liability risks are types of speculative risks.

Correct AnswerverifiedShow Answer

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