Day 1 Quiz Economics-Managing Risk (Insurance)

What statement(s) best describes insurance?

• coverage without a contract that guarantees payment if an insured loss occurs

• one way to manage risk in life

• both a & b are correct

• none of the above are correct

How does automobile liability coverage differ from full/comprehensive coverage?

• liability provides financial protection to a family if the major wage earner dies

• liability just covers damage and injuries to other drivers if the insured driver is at fault

• liability covers both insured and the other driver/vehicle if the insured driver is at fault

• all of the above are correct

How does automobile full/comprehensive automobile coverage differ from liability coverage?

• full/comprehensive coverage provides financial protection to a family if the major wage earner dies

• full/comprehensive coverage just covers damage and injuries to other drivers if the insured driver is at fault

• full/comprehensive coverage covers both insured and the other driver/vehicle if the insured driver is at fault

• all of the above are correct

What type of insurance offers individual, individual and spouse, and family coverage? It also usually provides prescription medicine coverage, also.

• automobile

• life

• disabiliy

• health

What type of insurance provides provides financial protection to a family when the insured, who is typically the major wage earner of the family, dies.

• automobile

• life

• disabiliy

• health

How does term life insurance differ from universal or whole life insurance?

• term life insurance provides coverage for a specific period of time while universal/whole life provides coverage until the death of the insured or the insured terminated the policy by collecting the cash value

• universal/whole life is usually obtained through employment

• term life is used as an investment

• all of the above are correct

What type of insurance usually has a liability feature that protects if someone is injured on the property of the insured?

• automobile

• life

• homeowner

• health

What type of insurance provides income during a specified period when a person is unable to work because of illness or an accident?

• automobile

• life

• homeowner

• disability

Which of the following term describes the amount paid to the insurance company for coverage?

• beneficiary

• deductible

• premium

• none of the above are correct

Which of the following term is the portion of money that must be paid when a claim is made?

• beneficiary

• deductible

• premium

• none of the above are correct