Question 1

The ____________ method to settle claims is based on the current replacement cost of a damaged or lost item less depreciation.

Accepted Answer

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

Question 2

Collision coverage pays for damage to your vehicle for such hazards as fire, theft, or wind damage.

Accepted Answer

A) True 
 B)False

Question 3

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) A) and D) E

Question 4

No-fault insurance systems have consistently reduced the time and costs involved in settling claims.

Accepted Answer

A) True 
 B)False

Question 5

Personal belongings of a high value can be protected with a personal articles endorsement.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following refers to a category based on your place of residence that is used to set automobile insurance premiums?

Accepted Answer

A)   rating territory
B)   assigned risk pool
C)   no-fault system
D)   driver classification
E)   use of the vehicleF) B) and D)
G) A) and D) A

Question 7

Which of the following factors is used to determine a person's driver classification?

Accepted Answer

A)   Age
B)   Type and age of vehicle
C)   Claims in your geographic area
D)   Insurance company claim processing costs
E)   State insurance premium regulationsF) C) and E)
G) A) and E) A

Question 8

The driver classification category is based on automobile style, model, and value of the vehicle.

Accepted Answer

A) True 
 B)False

Question 9

A rider is an addition of coverage to a standard insurance policy.

Accepted Answer

A) True 
 B)False

Question 10

Wind damage occurs to your car costing $1,000 to repair. If you have a $300 deductible for collision and full coverage for comprehensive, what portion of the claim will the insurance company pay?

Accepted Answer

A)   $300
B)   $1,300
C)   $500
D)   $700
E)   $800F) A) and B)
G) A) and C)

Question 11

Peril is defined as

Accepted Answer

A)   the refusal by an insurance company to pay for the covered loss.
B)   the cause of risk.
C)   the cause of a possible loss.
D)   an uncertainty as to loss.
E)   riskF) A) and B)
G) C) and D)

Question 12

Which of the following refers to a category based on age, sex, marital status, and driving habits that is used to set automobile insurance premiums?

Accepted Answer

A)   rating territory
B)   assigned risk pool
C)   no-fault system
D)   driver classification
E)   use of the vehicleF) All of the above
G) A) and E)

Question 13

A speculative risk is a risk that carries a chance of either loss or gain.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following is considered personal property for home insurance coverage?

Accepted Answer

A)   an automobile
B)   a garage
C)   a house
D)   appliances
E)   trees and shrubsF) B) and E)
G) A) and B)

Question 15

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

Accepted Answer

A) True 
 B)False

Question 16

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

Accepted Answer

A) True 
 B)False

Question 17

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) B) and E)
G) A) and B)

Question 18

There are no significant differences in home owner rates when comparing different insurance companies

Accepted Answer

A) True 
 B)False

Question 19

Risk is

Accepted Answer

A)   the chance that something may be lost.
B)   is the cause of a possible loss.
C)   the increased likelihood of loss through some peril.
D)   uncertainties of direct or indirect losses to property due to fire, windstorms, accidents, theft, and other hazards.
E)   loss possibilities due to negligence resulting in bodily harm or property damage to others.F) B) and C)
G) B) and D)

Question 20

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

Accepted Answer

A) True 
 B)False

Exam 8: Home and Automobile Insurance

The ____________ method to settle claims is based on the current replacement cost of a damaged or lost item less depreciation.

Correct AnswerverifiedShow Answer

Collision coverage pays for damage to your vehicle for such hazards as fire, theft, or wind damage.

Correct AnswerverifiedShow Answer

Liability risk

Correct AnswerverifiedE

No-fault insurance systems have consistently reduced the time and costs involved in settling claims.

Correct AnswerverifiedShow Answer

Personal belongings of a high value can be protected with a personal articles endorsement.

Correct AnswerverifiedShow Answer

Which of the following refers to a category based on your place of residence that is used to set automobile insurance premiums?

Correct AnswerverifiedA

Which of the following factors is used to determine a person's driver classification?

Correct AnswerverifiedA

The driver classification category is based on automobile style, model, and value of the vehicle.

Correct AnswerverifiedShow Answer

A rider is an addition of coverage to a standard insurance policy.

Correct AnswerverifiedShow Answer

Wind damage occurs to your car costing $1,000 to repair. If you have a $300 deductible for collision and full coverage for comprehensive, what portion of the claim will the insurance company pay?

Correct AnswerverifiedShow Answer

Peril is defined as

Correct AnswerverifiedShow Answer

Which of the following refers to a category based on age, sex, marital status, and driving habits that is used to set automobile insurance premiums?

Correct AnswerverifiedShow Answer

A speculative risk is a risk that carries a chance of either loss or gain.

Correct AnswerverifiedShow Answer

Which of the following is considered personal property for home insurance coverage?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

There are no significant differences in home owner rates when comparing different insurance companies

Correct AnswerverifiedShow Answer

Risk is

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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