Question 1

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 school
C)  Installing an alarm system in her car
D)  Participating in a carpool five days a week
E)  Any of these might qualify Amy for a discount.F) B) and E)
G) B) and D)

Question 2

What is the most common and costly natural disaster in the United States?

Accepted Answer

A)  Earthquakes
B)  Lightning strikes
C)  Floods
D)  Fires
E)  ThunderstormsF) D) and E)
G) A) and B)

Question 3

Nick Wilson owns a home in Edmond,Oklahoma and pays $795 per year in insurance on the home.The $795 fee is an example of a:

Accepted Answer

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

Question 4

A household inventory helps to provide evidence of ownership and value of items covered by home insurance.

Accepted Answer

A) True 
 B)False

Question 5

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)  major personal liability claims.
E)  flood damage.F) C) and D)
G) A) and B)

Question 6

Kevin Brown rides his bicycle to work so that he does not have to worry about getting in a car accident.How is Kevin managing his risk?

Accepted Answer

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

Question 7

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

Accepted Answer

A)  speculative
B)  pure
C)  commercial
D)  personal
E)  liabilityF) A) and E)
G) B) and E)

Question 8

Your geographic location is a major factor in determining the ________ used to calculate your automobile insurance premiums.

Accepted Answer

A)  driver classification
B)  assigned risk pool
C)  coverage level
D)  legal responsibilities
E)  rating territoryF) A) and C)
G) B) and E)

Question 9

Zachary Harris owns a home in Elk City.There was a bad thunderstorm and his gazebo was hit by lightning and burned to the ground.What part of his homeowner's insurance policy would cover this loss?

Accepted Answer

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

Question 10

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) B) and D)
G) B) and C)

Question 11

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

Accepted Answer

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

Question 12

Homeowners can obtain $10,000 coverage for sewage and drain backup damage for approximately:

Accepted Answer

A)  $50 to $80 per year.
B)  $80 to $100 per year.
C)  $100 to $200 per year.
D)  $200 to $300 per year.
E)  $300 to $400 per year.F) A) and E)
G) B) and D)

Question 13

Your home insurance policy has a $500 deductible.If a small fire causes $850 damage to your home,what amount of the claim would the insurance company pay?

Accepted Answer

A)  $250
B)  $350
C)  $500
D)  $850
E)  Not able to determine from this informationF) B) and D)
G) B) and E)

Question 14

Additional personal liability insurance beyond the basic coverage in a homeowner's policy is available with:

Accepted Answer

A)  an umbrella policy.
B)  a personal property floater.
C)  an endorsement.
D)  a coinsurance clause.
E)  medical payments coverage.F) A) and E)
G) B) and E)

Question 15

An umbrella policy provides additional personal liability coverage beyond the basic amounts in most homeowner policies.

Accepted Answer

A) True 
 B)False

Question 16

An assigned risk pool:

Accepted Answer

A)  exists in every state.
B)  reduces medical costs associated with auto accidents.
C)  takes unsafe drivers off the road.
D)  reduces auto insurance premiums with state regulation.
E)  offers premium discounts to safe drivers.F) B) and E)
G) B) and D)

Question 17

Wearing a seat belt in an automobile to protect yourself against the risk of injury in an automobile accident is an example of risk ________.

Accepted Answer

A)  reduction
B)  acceptance
C)  pooling
D)  shifting
E)  avoidanceF) C) and E)
G) None of the above

Question 18

If a homeowner leaves toys on stairs that results in injury to a delivery person,this may be ruled as:

Accepted Answer

A)  vicarious liability.
B)  negligence.
C)  assigned risk.
D)  umbrella coverage.
E)  coinsurance.F) C) and D)
G) B) and D)

Question 19

What type of personal liability coverage is also called a personal catastrophe policy?

Accepted Answer

A)  Umbrella policy
B)  Personal property floater
C)  Coinsurance floater
D)  Assigned risk clause
E)  Medical payments coverageF) None of the above
G) B) and C)

Question 20

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

Accepted Answer

A)  Automobile
B)  Garage
C)  Furniture
D)  House
E)  Trees and shrubsF) A) and B)
G) A) and E)

Exam 10: Property and Motor Vehicle Insurance

Homeowners can obtain $10,000 coverage for sewage and drain backup damage for approximately:

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Zachary Harris owns a home in Elk City.There was a bad thunderstorm and his gazebo was hit by lightning and burned to the ground.What part of his homeowner's insurance policy would cover this loss?

Correct AnswerverifiedShow Answer

Your geographic location is a major factor in determining the ________ used to calculate your automobile insurance premiums.

Correct AnswerverifiedShow Answer

Your home insurance policy has a $500 deductible.If a small fire causes $850 damage to your home,what amount of the claim would the insurance company pay?

Correct AnswerverifiedShow Answer

An umbrella policy provides additional personal liability coverage beyond the basic amounts in most homeowner policies.

Correct AnswerverifiedShow Answer

A household inventory helps to provide evidence of ownership and value of items covered by home insurance.

Correct AnswerverifiedShow Answer

Kevin Brown rides his bicycle to work so that he does not have to worry about getting in a car accident.How is Kevin managing his risk?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

An umbrella policy is designed to cover:

Correct AnswerverifiedShow Answer

Nick Wilson owns a home in Edmond,Oklahoma and pays $795 per year in insurance on the home.The $795 fee is an example of a:

Correct AnswerverifiedShow Answer

If a homeowner leaves toys on stairs that results in injury to a delivery person,this may be ruled as:

Correct AnswerverifiedShow Answer

What is the most common and costly natural disaster in the United States?

Correct AnswerverifiedShow Answer

What type of personal liability coverage is also called a personal catastrophe policy?

Correct AnswerverifiedShow Answer

Additional personal liability insurance beyond the basic coverage in a homeowner's policy is available with:

Correct AnswerverifiedShow Answer

An assigned risk pool:

Correct AnswerverifiedShow Answer

Wearing a seat belt in an automobile to protect yourself against the risk of injury in an automobile accident is an example of risk ________.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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