Question 1

A home made of wood is more expensive to insure than a comparable brick structure.

Accepted Answer

A) True 
 B)False

Question 2

Increased liability insurance is available with:

Accepted Answer

A)   an umbrella policy.
B)   a personal property floater.
C)   an endorsement.
D)   a coinsurance clause.
E)   All of theseF) A) and D)
G) A) and E)

Question 3

Explain the difference between strict and vicarious liability. Provide examples.

Accepted Answer

Strict liability is present when a perso...

Question 4

Joan Stone owns a home in Edmond, Oklahoma. She is worried her property might be damaged due to some unforeseen event. This worry about a loss is an example of a:

Accepted Answer

A)   peril.
B)   hazard.
C)   risk.
D)   premium.
E)   policy.F) D) and E)
G) A) and B)

Question 5

Most speculative risks are considered to be uninsurable.

Accepted Answer

A) True 
 B)False

Question 6

Property losses can be categorized into destruction of property, and losses due to:

Accepted Answer

A)   robbery.
B)   burglary.
C)   vandalism.
D)   arson.
E)   All of theseF) A) and B)
G) A) and C)

Question 7

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

Accepted Answer

A)   Hospital expenses for surgery
B)   Damage to another person's car when driving
C)   Accidental injury to a coworker on the job
D)   Wind damage to your roof
E)   Theft of business supplies from your officeF) A) and D)
G) B) and D)

Question 8

Craig Brown owns a home in San Francisco, California. There is a major earthquake and his house is damaged by the earthquake. What type of insurance would he have to have to cover this loss?

Accepted Answer

A)   Building and other structures
B)   Additional living expenses
C)   Personal property
D)   Personal liability
E)   Specialized coverageF) B) and C)
G) A) and B)

Question 9

Albert Finney owns a home in Pompano Beach, Florida. His house is broken into and the burglar steals his computer, his big screen TV, his stereo equipment, and his toaster. What part of his homeowner's insurance would cover this loss?

Accepted Answer

A)   Buildings and other structures
B)   Additional living expenses
C)   Personal property
D)   Personal liability
E)   Specialized coverageF) B) and C)
G) All of the above

Question 10

Increased liability insurance is available with an umbrella policy.

Accepted Answer

A) True 
 B)False

Question 11

Personal risks are the uncertainties surrounding the loss of income or life due to all except:

Accepted Answer

A)   professional misconduct.
B)   premature death.
C)   illness.
D)   disability.
E)   unemployment.F) All of the above
G) A) and D)

Question 12

Thad Joslin was judged at fault in an automobile accident. Three others were awarded damages of $150,000, $75,000, and $75,000. Thad has 100/300 bodily injury liability coverage. What amount, if any, would not be covered by his insurance?

Accepted Answer

A)   $150,000
B)   $100,000
C)   $50,000
D)   $25,000
E)   None. The total amount would be covered by insurance.F) A) and D)
G) B) and D)

Question 13

William Bennett owns a home in Oviedo, Florida. There was a fire in his home and he and his family had to move to a motel until his home could be fixed. What part of his homeowner's insurance policy would cover the cost of the motel?

Accepted Answer

A)   Buildings and other structures
B)   Additional living expenses
C)   Personal property
D)   Personal liability
E)   Specialized coverageF) All of the above
G) D) and E)

Question 14

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

Accepted Answer

A) True 
 B)False

Question 15

The comprehensive form of homeowner's insurance includes coverage for damage due to floods.

Accepted Answer

A) True 
 B)False

Question 16

Susan Bize owns a home in Edmond, Oklahoma. She has a coffee maker in the home that has been recalled because it is likely to start fires. The coffee maker is an example of a:

Accepted Answer

A)   peril.
B)   hazard.
C)   risk.
D)   premium.
E)   deductible.F) A) and E)
G) A) and B)

Question 17

Larry Foster has bought a car with front and side airbags and antilock brakes. How is Larry managing his risk?

Accepted Answer

A)   Avoidance
B)   Reduction
C)   Assumption
D)   Shifting
E)   DevelopmentF) All of the above
G) A) and E)

Question 18

What factors affect the cost of home insurance?

Accepted Answer

The main influences on home insurance co...

Question 19

Which of the following might qualify Amy Farmer for a premium discount on her automobile insurance?

Accepted Answer

A)   Completing a driver's training program
B)   Earning straight A's in college
C)   Installing an alarm system in her car
D)   Participating in a carpool five days a week
E)   All of these might qualify Amy for a discount.F) C) and D)
G) B) and C)

Question 20

Hermione Granger borrowed her best friend's car and was in an accident. She was at fault. The car was totaled. What part of Hermione's automobile insurance policy would cover the damage to her friend's car?

Accepted Answer

A)   Bodily injury liability
B)   Medical payments coverage
C)   Property damage liability
D)   Collision
E)   Comprehensive physical damageF) B) and E)
G) A) and E)

Exam 10: Property and Motor Vehicle Insurance

Most speculative risks are considered to be uninsurable.

Correct AnswerverifiedShow Answer

Hermione Granger borrowed her best friend's car and was in an accident. She was at fault. The car was totaled. What part of Hermione's automobile insurance policy would cover the damage to her friend's car?

Correct AnswerverifiedShow Answer

Increased liability insurance is available with:

Correct AnswerverifiedShow Answer

A home made of wood is more expensive to insure than a comparable brick structure.

Correct AnswerverifiedShow Answer

Property losses can be categorized into destruction of property, and losses due to:

Correct AnswerverifiedShow Answer

Joan Stone owns a home in Edmond, Oklahoma. She is worried her property might be damaged due to some unforeseen event. This worry about a loss is an example of a:

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The comprehensive form of homeowner's insurance includes coverage for damage due to floods.

Correct AnswerverifiedShow Answer

Explain the difference between strict and vicarious liability. Provide examples.

Correct AnswerverifiedStrict liability is present when a perso...View AnswerShow Answer

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

Correct AnswerverifiedShow Answer

Craig Brown owns a home in San Francisco, California. There is a major earthquake and his house is damaged by the earthquake. What type of insurance would he have to have to cover this loss?

Correct AnswerverifiedShow Answer

Increased liability insurance is available with an umbrella policy.

Correct AnswerverifiedShow Answer

Which of the following might qualify Amy Farmer for a premium discount on her automobile insurance?

Correct AnswerverifiedShow Answer

William Bennett owns a home in Oviedo, Florida. There was a fire in his home and he and his family had to move to a motel until his home could be fixed. What part of his homeowner's insurance policy would cover the cost of the motel?

Correct AnswerverifiedShow Answer

Susan Bize owns a home in Edmond, Oklahoma. She has a coffee maker in the home that has been recalled because it is likely to start fires. The coffee maker is an example of a:

Correct AnswerverifiedShow Answer

Larry Foster has bought a car with front and side airbags and antilock brakes. How is Larry managing his risk?

Correct AnswerverifiedShow Answer

Albert Finney owns a home in Pompano Beach, Florida. His house is broken into and the burglar steals his computer, his big screen TV, his stereo equipment, and his toaster. What part of his homeowner's insurance would cover this loss?

Correct AnswerverifiedShow Answer

What factors affect the cost of home insurance?

Correct AnswerverifiedThe main influences on home insurance co...View AnswerShow Answer

Thad Joslin was judged at fault in an automobile accident. Three others were awarded damages of $150,000, $75,000, and $75,000. Thad has 100/300 bodily injury liability coverage. What amount, if any, would not be covered by his insurance?

Correct AnswerverifiedShow Answer

Personal risks are the uncertainties surrounding the loss of income or life due to all except:

Correct AnswerverifiedShow Answer

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Strict liability is present when a perso...
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The main influences on home insurance co...
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