Insurance Unit Quiz

Which person will probably have the LEAST expensive health insurance payments?

• Julian, age 57, who has been healthy most of his life
• Samantha, age 32, who is a smoker but hasn't shown any signs of health problems
• Patty, age 26, who works as an administrative assistant at a marketing firm
• Robin, age 72, who jogs 50 miles per week to stay fit

Which term refers to an arrangement where you are responsible for paying a percentage of covered medical expenses after your deductible is met?

• Deductible limit
• Premium
• Out-of-network fees
• Co-insurance

How do insurance companies decide how much to charge an individual for their monthly premiums?

• The company assesses the individual's risk factors and assigns higher premiums to higher risk individuals
• The company looks at the individual's tax filings from the previous year to assess overall wealth and ability to pay
• The company charges the same premium for every individual eligible for coverage
• The company increases or decreases premium rates based on the stock market

Frank has an auto policy with a coverage limit of $30,000 and a deductible of $1,000. He gets into an accident and the damages to his car total $6,200. How much will Frank need to pay out-of-pocket?

• $0
• $1,000
• $7,000
• $22,000

You cause an accident in which someone is injured. The case goes to trial and there is a verdict to compensate the injured person with $58,000. You have a $50,000 coverage limit per person for Bodily Injury. How much will you have to pay out-of-pocket?

• $58,000
• $8,000
• $0
• Only your deductible amount

What is the purpose of insurance?

• build wealth
• transfer risk
• manage assets
• build relationships

Alice is trying to save money, so she decides she’ll only buy renters insurance if and when something bad happens at her apartment. Why won’t her strategy work?

• Insurance companies will only cover losses suffered while the policy is already in place.
• Renters insurance only provides coverage for dorms, not apartments.
• Alice will only be able to recover costs of furniture if she buys renters insurance after something bad happens at her apartment.
• Insurance companies will only cover damages to her apartment if she pays triple the premium for the first month.

Why would someone choose to get long term disability insurance even if they already have health insurance?

• Long term disability only covers medical bills, while health insurance will help compensate for lost work with 40-60% of their income.
• Long term disability insurance plans can also extend coverage to family members and pets.
• Health insurance only covers regular check ups, while long term disability insurance also covers emergencies.
• Health insurance only covers medical bills, while long term disability will help compensate for lost work with 40-60% of their income.

When setting your premium, your car insurance company may consider each of the following EXCEPT...

• How many miles you drive per year
• Your age
• Your driving record
• Your height

What does insurance help to protect you from?

• Getting hurt in an auto accident.
• The risk of financial loss.
• Having to pay anything for doctor bills or car repairs in the case of an accident.
• Losing your job.