W!SE Review 5 - Insurance & Credit

For the past 5 years, a person has had a $20,000 whole life insurance policy that has a cash value clause.  The person decides to surrender the policy.  At the time of surrender, the person will receive

• one-fifth of the $20,000 face value
• $20,000 less the premiums paid
• a calculated amount of money which includes the premiums paid as well as the interest on that money
• a calculated amount of money that must be converted to a term life insurance policy

A woman has just received a very expensive piece of jewelry.  The woman has homeowner's insurance.  Which statement would it be most appropriate for her to make to he insurance agent?

• " I think I need a personal property floater"
• "I think I should get speculative risk insurance"
• "I will deduct the cost of the jewelry from my premium"
• "I realize that if this jewelry is stolen it will be considered vicarious liability"

A person buys a flat screen, HD, theater-like television.  The person has homeowner's insurance.  Why would it be appropriate to add a personal property floater to that insurance?

• To reduce the premium on the homeowner's insurance
• To protect the person who owns the television from liability for damages
• to show the insurance company a good faith investment has been made
• to cover the cost of replacement should the television get damages or stolen

The only type of life insurance that does not develop cash value is 

• term life
• whole life
• universal life
• variable universal life

When a self-employed person decides to purchase disability insurance, it is generally to 

• lessen the possibility of becoming injured
• protect against the financial effects of not being able to work
• eliminate the chance of going out of business
• insure that the cost of injury caused to others will be reimbursed

If you have a managed health care plan, it means that you

• usually must first meet with your primary health care physician
• can go to any doctor at any time
• will be responsible for $100 of a doctor bill
• can apply for an 80% reimbursement of the amount paid to the doctor

Debbie owns a clothing store.  She is concerned that a customer who is injured in the store will sue.  Which type of insurance should Debbie purchase?

• social insurance 
• life insurance
• surety bonds
• liability insurance

Sally's health insurance policy requires her to pay the first $500 of medical costs each year before the company will pay any of her medical bills.  This policy provision is the:

• Co-insurance clause
• Premium
• Annual deductible
• Major medical benefit

Mr. Akon's wife died.  The money he received as the beneficiary on her life insurance is called the:

• Cash value
• Death benefit or face value
• Separate value
• Premium or annuity value

Why is term life insurance usually the least expensive type of life insurance?

• The policy only pays a death benefit
• The policy builds a cash value
• The policy provides coverage for a lifetime
• The policy is available to all consumers