Review- Chapter 13

The person who gets the life insurance benefit when the policyholder dies is the

• coverage

• beneficiary

• insurance agent

• policyholder

The type of insurance that protects you if someone gets hurt on your property is

• collision insurance

• property insurance

• life insurance

• liability insurance

Answer explanation

Remember our discussion about pool fences and liability.

The person who purchases life insurance is the

• secretary

• agent

• policyholder

• beneficiary

Owning an accident insurance policy reduces the

• number of accidents.

• chances of having an accident.

• need for safety devices.

• financial losses from an accident.

Answer explanation

Accident insurance cannot prevent accidents. But it helps with the resulting expenses.

Kate is looking for insurance to help insure against the risk of major medical bills for her and her family. She should focus first on

• life insurance

• property insurance

• health insurance

• automobile insurance

Answer explanation

Health insurance is designed to help you deal with health care costs such as hospital visits.

Unfortunate harms and costs that happen to people are also known as

• health insurance

• risks

• premiums

• cash value

Rusty signs a contract with Progressive for car insurance. The contract is his

• policy

• beneficiary

• risk

• extended coverage

Answer explanation

Insurance policies represent agreements between the policyholder and the insurance company.

The protection that people seek from the risks of harms and losses is known as

• insurance

• lawsuits

• extended coverage

• premium

Life insurance for older people is more expensive than for younger people because

• younger people are better-looking.

• older people are more likely to die.

• younger people are more likely to die.

• older people don't complain as much.

Answer explanation

Remember that insurance companies are "firms" or businesses that seek to maximize profit. Older people are more likely to need claim benefits, so insurance companies charge them more.

Abid sends $100 a month to Liberty Mutual to keep his life insurance policy active. The $100 represents Abid's

• liability

• risks

• cash value

• premium

Answer explanation

Premium are usually monthly or maybe twice/year payments that keep your policy active.