Question 1

A claims adjustor may work for:
A) the insurance company.
B) an independent adjustment bureau.
C) himself.
D) any of the above
E) none of the above

Accepted Answer

A claims adjustor may work for the insurance company, an independent adjustment bureau, or may work for themselves. All three options are possible career paths for a claims adjustor.

Question 2

After packing up to return home for the holidays after the fall semester,Peter stopped at Double T bookstore to sell textbooks.After collecting $25,he headed back to his pickup truck only to find a broken window,the truck broken into,and all his suitcases and personal property gone.The damages to his pickup would be covered by:
A) property damage liability auto coverage.
B) uninsured motorist auto coverage.
C) personal injury protection.
D) comprehensive (other than collision)auto coverage.
E) collision coverage.

Accepted Answer

Comprehensive (other than collision) auto coverage provides protection from losses due to theft, vandalism, and other events not related to a collision. This coverage would typically cover the damages to Peter's truck as well as his stolen personal property.

Question 3

An automobile covered under a policy with a $500 collision deductible is damaged in a collision with a fence.It could be repaired for $15,000,replacement cost is $25,000,and the depreciation and physical condition deduction is $5,000.How much will the insurance company pay?
A) $24,500
B) $7,500
C) $15,000
D) $14,500
E) Some other amount

Accepted Answer

The insurance company will pay the cost of repair or replacement minus the deductible and any applicable depreciation.

In this case, the cost of repair is $15,000, but after subtracting the $5,000 deduction for depreciation and physical condition, the amount is reduced to $10,000. Since the policy has a $500 deductible, the insurance company will pay $9,500 towards the cost of repair.

Since the cost of replacement is $25,000, after subtracting the $5,000 deduction, the amount is reduced to $20,000. Since this amount is greater than the cost of repair, the insurance company will pay the lesser amount of $9,500.

Therefore, the total amount the insurance company will pay is $9,500. However, the question asks for the amount the insurance company will pay, not the total cost of repair or replacement, so the correct answer is D) $14,500, which is the cost of repair minus the $500 deductible.

Question 4

Section I of a homeowner's insurance policy covers all of the following except:
A) personal liability
B) dwelling
C) other structures
D) personal property
E) all above are covered

Accepted Answer

The answer of Section I of a homeowner's insurance policy...

Question 5

Premium discounts may result from:
A) safe driving record and prompt premium payment.
B) good grades and long-term employment.
C) multiple auto ownership and good credit rating.
D) safe driving record and good academic grades.
E) long-term employment and prompt payment of traffic tickets.

Accepted Answer

Premium discounts are often given for a safe driving record and good academic grades, as these factors are associated with lower risk for insurers.

Question 6

After packing up to return home for the holidays after the fall semester,Tex stopped at Double T bookstore to sell textbooks.After collecting $25,he headed back to his pickup truck only to find a broken window,the truck broken into,and all his suitcases and personal property gone.The loss of his personal property and suitcases would be covered by:
A) umbrella liability insurance.
B) comprehensive (other than collision)auto coverage.
C) property damage liability auto coverage.
D) property damage to the property of others (homeowners' coverage).
E) personal property off premises (homeowners' coverage).

Accepted Answer

The answer of After packing up to return home for...

Question 7

Collision protection pays for damage to:
A) non-auto property of insured.
B) auto of insured.
C) all autos in accident.
D) auto of other party in accident.
E) non-auto property of others damaged in accident.

Accepted Answer

The answer of Collision protection pays for damage to:
A) non-auto...

Question 8

What factor affects insurance premiums the most?
A) Style
B) Age
C) Brick or wood exterior
D) Credit score
E) Detached or attached garage

Accepted Answer

The answer of What factor affects insurance premiums the most?
A)...

Question 9

The best place to buy automobile insurance is:
A) insurance agent
B) auto dealer
C) finance company
D) state insurance commission
E) none of the above

Accepted Answer

An insurance agent can provide personalized assistance and help compare different policies and prices from various insurance companies, which can save money in the long run. Auto dealers and finance companies may offer insurance, but their policies may not always be the most competitive or comprehensive. The state insurance commission is a regulatory agency that oversees the insurance industry but does not sell insurance directly to consumers. Therefore, the best option is to go with an insurance agent.

Question 10

The advisable dollar limit for any one auto accident is:
A) $50,000
B) $100,000
C) $200,000
D) $300,000
E) $500,000

Accepted Answer

The advisable dollar limit for any one auto accident is $300,000. This is because medical expenses, property damage, and other costs associated with a serious accident can quickly add up and exceed lower coverage limits. It is always better to be over-insured than under-insured in case of a worst-case scenario.

Question 11

Jake drove Amanda's truck to the football bowl game because his car was broken.On the way home,Jake was involved in an accident that was his fault.The resulting liability damages totaled $85,000.Jake has $100,000 liability coverage on his car,and Amanda has $50,000 insurance on her truck.How would the $85,000 liability damages be paid for this accident?
A) $50,000 from Amanda's policy with no further payment
B) $85,000 from Jake's policy
C) $50,000 from Amanda's policy plus $35,000 from Jake's policy
D) $50,000 from Amanda's policy plus $35,000 out of Jake's pocket
E) $50,000 from Amanda's policy plus $35,000 out of Amanda's pocket.

Accepted Answer

Since Jake was driving Amanda's truck, her policy would be the primary insurance coverage. Her policy would pay up to its limits of $50,000, then Jake's policy would kick in to cover the remaining $35,000. Therefore, the damages would be paid with $50,000 from Amanda's policy plus $35,000 from Jake's policy.

Question 12

Auto insurance premiums would be affected by:
A) auto body type.
B) auto engine size.
C) business usage.
D) commuting over 50 miles daily.
E) all of these

Accepted Answer

Auto insurance premiums can be affected by a variety of factors including auto body type, auto engine size, business usage, and commuting over 50 miles daily. Therefore, all of these choices could impact the cost of auto insurance premiums.

Question 13

Your car is damaged by fire while parked in your garage.Protection would be provided by:
A) comprehensive auto coverage.
B) property damage liability coverage.
C) homeowner's personal property coverage.
D) homeowner's dwelling unit coverage.
E) auto collision coverage.

Accepted Answer

Comprehensive auto coverage provides protection for fire damage to your vehicle, even when it is not being driven. None of the other options listed would cover damage to a vehicle in this situation.

Question 14

Auto insurance premiums are generally reduced by:
A) choosing a higher deductible.
B) buying a sporty "high powered" car.
C) moving to a larger city.
D) avoiding carpooling to work.
E) all of the above

Accepted Answer

Choosing a higher deductible will generally lead to lower auto insurance premiums. This is because by agreeing to pay a larger share of the cost of any potential claims, the insurance company is taking on less risk, and so they can charge lower premiums. Buying a sporty "high powered" car, moving to a larger city, and avoiding carpooling to work are all factors that can actually increase auto insurance premiums, as they are associated with a higher risk of accidents or theft.

Question 15

Auto insurance companies may offer premium discounts for:
A) being a good student.
B) installing anti-theft devices.
C) taking a defensive driving course.
D) all of these
E) none of these

Accepted Answer

Auto insurance companies may offer premium discounts for being a good student, installing anti-theft devices, and taking a defensive driving course. Therefore, all of these choices are correct.

Question 16

If you have an outstanding loan on your car,the contract will require you to carry a(n)_____ insurance.
A) bodily injury liability
B) property damage liability
C) medical payments
D) collision or comprehensive
E) all of these

Accepted Answer

If you have an outstanding loan on your car, the contract will require you to carry collision or comprehensive insurance. This type of insurance covers damage to your own car in case of an accident, theft, or other incidents. The other insurance types listed may be required by your state or recommended for additional coverage, but they do not necessarily relate to your car loan.

Question 17

Examples of additional,optional automobile coverage includes:
A) towing.
B) hub cap coverage.
C) auto rental reimbursement.
D) repainting coverage.
E) a and c

Accepted Answer

Towing and auto rental reimbursement are examples of additional, optional automobile coverage.

Question 18

You could save money on your car insurance premiums by:
A) buying a 4-door sedan.
B) choosing a $1,000 deductible.
C) moving to a small town.
D) all of these.
E) none of these would make any difference

Accepted Answer

The answer of You could save money on your car...

Question 19

Factors that affect home insurance costs include:
A) type of structure.
B) location of home.
C) credit score.
D) all of the above
E) none of the above

Accepted Answer

The answer of Factors that affect home insurance costs include:
A)...

Question 20

A(n)_____ agent represents multiple insurance companies.
A) captive
B) business
C) good
D) independent
E) employed

Accepted Answer

An independent agent represents multiple insurance companies, while a captive agent represents only one insurance company. A business or employed agent is not specific to the insurance industry, and a "good" agent is subjective and not a recognized term in the insurance industry.

Quiz 10: Protecting Your Property

A claims adjustor may work for:

An automobile covered under a policy with a $500 collision deductible is damaged in a collision with a fence.It could be repaired for $15,000,replacement cost is $25,000,and the depreciation and physical condition deduction is $5,000.How much will the insurance company pay?

Section I of a homeowner's insurance policy covers all of the following except:

Premium discounts may result from:

Collision protection pays for damage to:

What factor affects insurance premiums the most?

The best place to buy automobile insurance is:

The advisable dollar limit for any one auto accident is:

Auto insurance premiums would be affected by:

Your car is damaged by fire while parked in your garage.Protection would be provided by:

Auto insurance premiums are generally reduced by:

Auto insurance companies may offer premium discounts for:

If you have an outstanding loan on your car,the contract will require you to carry a(n) _____ insurance.

Examples of additional,optional automobile coverage includes:

You could save money on your car insurance premiums by:

Factors that affect home insurance costs include:

A(n) _____ agent represents multiple insurance companies.