Unit 8 (Insurance) Quiz Review

1. 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

2. Your renter's insurance policy costs $35/month and has a $2,000 deductible. A thief breaks into your apartment and steals your $1,300 TV set. How much would your insurance company pay?

• $0

• $700

• $1,300

• $2,000

3. Insurance companies make money by...

• Refusing to pay out claims to policyholders

• Collecting money from the government

• Collecting more in premiums than they need to pay out each year

• Keeping costs low with minimal advertising

4. Which term refers to the percentage of covered medical expenses you are responsible for paying after your deductible is met?

• Deductible limit

• Premium

• Out-of-network fees

• Co-insurance

5. What type of auto insurance are you required to carry in almost every state (49 out of 50)?

• Insurance if you damage your own property

• Insurance if you cause injury to another person

• Insurance in case you get into an accident with someone who does not have insurance

• Insurance if you cause injury to yourself

6. 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 a percentage of their income

7. You cause an accident and injure the other driver. The case goes to trial and there is a verdict to compensate the injured person with $63,000. You have an $85,000 coverage limit per person for Bodily Injury. How much will the insurance company pay?

• $0

• $22,000

• $63,000

• $85,000

8. What is an insurance premium?

• Your monthly payment to your insurer, regardless of whether you use any services

• A list of the procedures covered by your insurance carrier

• An added cost you pay in order to receive higher-quality services

• The amount you pay out-of-pocket for a specific procedure or service

9. Frank has an auto policy with a coverage limit of $25,000 and a deductible of $1,500. He gets into an accident and the damages to his car total $5,400. Fortunately, he has collision coverage. How much will Frank need to pay out-of-pocket?

• $0

• $1,500

• $5,400

• $25,000

10. Which of the following statements is TRUE about auto insurance premiums?

• If you have an auto insurance policy and don't get into a car accident or file any claims for a year, you get your premiums back from the insurance company

• If you have an auto insurance policy and get into multiple accidents within one year, your premium amount will decrease

• Auto insurance premiums are a fixed price across all insurance companies

• If you have an auto insurance policy and get into multiple accidents within one year, your premium amount will increase