WorksheetsPersonal Finance - Unit 6 Review
Total questions: 16
Worksheet time: 12mins
When 30-year-old Lindsay was in a coma for 3 months, her friend Corey had the legal authority to handle her personal, financial, and medical affairs. Why did Corey have the legal right to do this?
Corey was her life insurance agent.
She had chosen Corey as her executor.
Corey was named as her guardian.
Corey had designated power of attorney.
If you’ve insured a home for $200,000 and the home is only worth $150,000, you can only receive $150,000 at the most if you file a claim.
True
False
While jumping on the trampoline at your house, your daughter’s friend broke her arm. Which type of insurance would MOST likely cover you for this incident?
whole life insurance
homeowner’s insurance
auto insurance
permanent life insurance
Derrick recently got married and has a small child. For the first time in his life, he worries about what will happen to his home and his other property after he dies. He also wants to make sure his child is taken care of if he dies. What should Derrick prepare?
a will
a power of attorney
a health insurance policy
a consideration
Starting a small business or engaging in gambling are pure risks because both offer the possibility of success and/or failure.
True
False
Michael’s basement recently flooded. He has a homeowner’s policy covering flood damage that has a $500 deductible. The total damages to the basement totaled $2500. How much will the insurance company pay in this scenario?
$500
$2500
nothing
$2000
If Damien loses his job due to injury, he worries that his family won’t be able to survive without his income. He decides to purchase disability insurance that will provide money for him and his family if he should ever become physically unable to work. By purchasing this type of insurance, from which type of risk is Damien trying to protect himself?
property risk
personal risk
inheritance risk
liability risk
Rinaldo’s dad left a handwritten will that he had prepared by himself in his own handwriting. He left everything to his dog Rusty. Which type of will is this?
statutory will
formal will
simple will
holographic will
When Christopher dies, he wants to leave one half of his adjusted gross estate to his spouse and the other half of the estate to the American Cancer Society. What type of will does he need to create?
marital share will
simple will
exemption trust will
stated amount will
Donald’s home was recently destroyed by a fire. He made an insurance claim for $250,000. Who is responsible for paying him the $250,000?
the policyholder
the insurer
the person with power of attorney
the rider
What type of risks are considered accidental and unintentional?
pure risks
speculative risks
classified risks
uninsured risks
Alicia accidentally hit the bumper of her car by driving into a tree. She has a car insurance policy with $1000 deductible. The total damage to the car is $500. How much will the car insurance company pay in this scenario?
$500
$1000
nothing
the total value of the car
Some people include a letter of last instruction in their estate planning. What is likely TRUE about this letter?
It gives family members important information, such as where the person wants to be buried.
This letter is always legally binding, with legal questions rarely coming into play.
This letter lists who has power of attorney and, therefore, who receives any leftover money or land.
It lists all of the medical interventions needed before decisions about the person’s end-of-life plans are decided.
Kato is getting ready to sign a complicated contract at work. What is the BEST advice for him?
Obtain an exact copy of the contract at the time it is signed.
Don’t waste everyone’s time by reading every single word.
Lawyers are not helpful when dealing with contracts.
Leave blank spaces empty, as they will be filled in after you sign the contract.
Jeff needs car insurance. He is debating between purchasing liability insurance or a comprehensive policy. What is one TRUE statement about these options that can help him make an informed decision?
Liability insurance offers to replace the car if it is destroyed in an accident.
A comprehensive policy is generally required if a bank helps you purchase a vehicle.
Liability insurance offers coverage when there is a theft.
A comprehensive policy usually requires a lower premium than liability coverage.
Emily just got a car. She needed insurance, so she has purchased the insurance and pays the premium. Who is Emily in this scenario?
the person with power of attorney
the insurer
the policyholder
the rider
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