Understanding Insurance Concepts and Terms

What is guaranteed by the protection of insurance?

• Reimbursement for a loss

• A fixed income

• A higher credit score

• A tax deduction

How often can a policy limit be set?

• Per month

• Per week

• Per year or per life of the policy

• Per day

What is a claim in insurance terms?

• A payment made by the insurer

• A request made by a policyholder for compensation

• A discount offered by the insurer

• A penalty charged by the insurer

What happens when an incident occurs in terms of insurance?

• The insurer automatically pays the claim

• The policyholder submits a claim to the insurance company

• The policyholder pays the premium

• The policy limit is increased

Which term refers to the price of a policy?

• Deductible

• Claim

• Premium

• Policy Limit

What might happen if many vehicles insured by the same company are involved in a collision?

• The company will benefit financially

• The company will take a large hit with payouts

• The company will increase premiums

• The company will offer discounts

What assumption do insurance companies make about policy usage?

• Everyone will use their policy at once

• Not everyone will need to use their policy at once

• Policies will never be used

• Policies will be used frequently

What is the main concern for insurance companies regarding policy coverage?

• Ensuring all policies are used simultaneously

• Managing the risk of simultaneous claims

• Increasing the number of policies sold

• Reducing the number of agents

What does having personal insurance not cover?

• Your health

• Your car

• Your business

• Your home

What type of insurance is not mentioned as common for individuals?

• Auto insurance

• Health insurance

• Business insurance

• Homeowners insurance