WorksheetsLUTCF Course 2 Part 2
Total questions: 58
Worksheet time: 29mins
Liability automobile insurance is intended to cover fire, flood, theft, vandalism, and glass breakage.
TRUE
FALSE
Which type of automobile insurance coverage is considered first party coverage and is a contract between the insurance company and the insured?
Collision
Liability
None of the above
The insured party has a duty to cooperate with the insurance company and should not admit fault to the other driver, authorities, or anyone else.
TRUE
FALSE
If a vehicle is a total loss, the fair market value will be determined using recognized industry standards and the deductible and the cost of any prior damage will be added to the insurance proceeds.
TRUE
FALSE
Which of the following are common EXCLUSIONS for automobile insurance policies?
Medical payments
Cars for hire, such as taxis and ride shares
Contents of the vehicle
Electronic equipment not attached to the vehicle
Wear and tear
More often than not, homeowners coverage is purchased with replacement cost coverage as an additional option.
TRUE
FALSE
Which of the following statements are TRUE regarding homeowners insurance?
Building coverage specifically covers the actual building and most permanently attached items.
Contents are typically insured for 80-90% of the value of the home.
Detached garages, sheds, and fences are covered at a lesser amount than the home itself.
Liability coverage is included to protect from loss due to injuries occurring on the property.
If the home is no longer livable, loss of use coverage is available to provide housing.
Which of the following may be excluded under a homeowners insurance policy? Select all that apply.
Flood
Mold
Water failure
Nuclear hazards
War
Condominium owners insurance coverage only covers the portion of the building the condominium owner owns.
TRUE
FALSE
Which of the following statements are TRUE regarding commercial property and liability insurance?
Covered items may include property owned and the property of others in control by the owner.
It is not very customizable.
It is mainly sold by agents who specialize in commercial insurance.
Smaller businesses typically use a commercial general liability policy.
Liability umbrella policies, sometimes called personal article floaters, are ideal for items that have some limited coverage under the homeowners coverage.
TRUE
FALSE
Which of the following statements are TRUE regarding liability umbrella policies?
Defense costs are covered no matter the outcome.
Deductibles are always waived.
Limits usually range from 1millionto 10 million.
Recreational vehicles are usually excluded.
Which of the following statements are TRUE regarding inland marine insurance?
It can be stand-alone or written as a personal articles floater on a homeowners policy.
It provides greater limits and broader coverage.
Policies are easily customizable.
Policies often do not have a deductible.
Property is insured anywhere in the world against any type of loss not typically excluded.
Which of the following invests in companies whose stock consistently pays dividends and may include convertible bonds?
Aggressive growth funds
Global funds
Growth and income funds
Value funds
Which of the following may invest in large cap, mid cap, small cap, growth, value, or blend funds?
Bond funds
Money market funds
Stock funds
All of the above
Which of the following may own treasury bills, certificates of deposit, and commercial paper?
Bond funds
Money market funds
Stock funds
Principal underwriters handle the bookkeeping functions of the fund and maintain shareholder account records, handle purchases and redemptions, calculating and disbursing dividends as well as preparing and mailing periodic statements to shareholders.
TRUE
FALSE
Which of the following statements are TRUE regarding bond fund classifications?
Global bond funds invest in bonds from companies around the world, including the United States.
High-yield bond funds invest in bonds that are below investment grade.
Ginnie Mae bond funds invest in mortgage-backed securities.
Corporate bond funds invest in low grade corporate debt.
National municipal bond funds invest in municipal bonds from around the world.
Target date funds adjust the mix of stocks, bonds, and money market investments over time from aggressive to conservative.
TRUE
FALSE
Which of the following statements are TRUE regarding stock fund classifications?
Equity income funds invest in companies whose stock consistently pays high dividends.
International funds invest in companies outside the United States and inside the United States.
Specialty funds invest in a particular segment of the market, such as gold, energy, or technology.
Growth and income funds invest in stocks that consistently pay dividends.
Aggressive growth funds seek maximum capital appreciation.
Which of the following classifies funds by the duration of the portfolio and credit quality?
Equity style box
Fixed income style box
Which of the following statements are TRUE regarding index funds?
Index funds are passively managed.
Index funds have very high expense ratios.
Index funds are generally used for portfolio holdings for retirement accounts.
These funds seek to match the risk and return of the market.
Which of the following statements are TRUE regarding flexible portfolio funds?
They are able to invest in stocks, bonds, money market instruments, or a combination of the three.
Asset allocation funds have a range of percentages of various types of investments.
Target date funds are aggressive investments.
Fixed income funds are designed to provide a stream of income over a period of time.
Which of the following statements are TRUE regarding stock funds?
Mid cap funds have a market value of 2 billion to 10 billion.
Large cap funds have a market value of $10 billion or greater.
Small cap funds have a market value of 300 million to 2 billion.
Blend funds hold both value and growth assets.
Value funds invest primarily in established companies that are undervalued.
Which of the following statements is TRUE regarding systemic risk?
It is associated with the market as a whole and is therefore non-diversifiable.
It is associated with the market as a whole and is therefore diversifiable.
It is unique to a specific investment and is therefore diversifiable.
It is unique to a specific investment and is therefore non-diversifiable.
Over a period of time, returns can be impacted by all of the following EXCEPT ____.
The investors tax bracket and whether or not the investment is in a qualified plan.
The rate of inflation during the period being measured.
The past performance of the fund prior to the period being measured.
The impact of the fund manager as measured by alpha.
Which of the following class shares is best for an investor who has a shorter time horizon?
Class A
Class B
Class C
All of the above
Which of the following class shares is best for an investor who has significant lump sum to invest initially?
Class A
Class B
Class C
All of the above
The lower the standard deviation, the more widely dispersed the expected returns making it more risky.
TRUE
FALSE
Using the following information, what is the annualized return for this account? Balance on January 1st: 12,789.45, interest and dividends 158.12, Capital Gains: 175.84, fees 200.05, Balance on January 31st: $12,923.36
1.05%
4.20%
12.60%
15.30%
Returns are simply a measure of the results. Whether or not that result is acceptable depends on how it compares relative to other similar investments and the client's goals.
TRUE
FALSE
To calculate return on an investment, subtract the ending balance from the beginning balance, divide the net increase by the beginning balance, and move the decimal point two places to the right.
TRUE
FALSE
If Class B shares are held for the entire time period, the fees charged using Class B shares would be almost equivalent to what Class A shares would have charged over the same time period, assuming both time periods were at least seven years.
TRUE
FALSE
Time value of money is the concept that money paid or received today is not as valuable as money paid or received in the future because the money received today can be invested and potentially increase.
TRUE
FALSE
There are no breakpoints with Class B shares.
TRUE
FALSE
The purpose of health insurance is to protect against significant medical claims.
TRUE
FALSE
Which of the following are TRUE statements regarding the Affordable Care Act?
Children can stay on a parent's policy until they turn 26. Individuals are expected to carry health insurance coverage and employers with more than 50 employees are required to provide health insurance coverage.
Individuals are not expected to carry coverage.
Employers with more than 15 employees are required to offer health insurance coverage.
Lifetime limits on claims were eliminated. Individuals are expected to carry health insurance coverage and employers with more than 50 employees are required to provide health insurance coverage.
Pre-existing conditions are no longer taken into consideration. Individuals are expected to carry health insurance coverage and employers with more than 50 employees are required to provide health insurance coverage.
Platinum policies pay 90% and the insured pays 10%, on average.
TRUE
FALSE
Which of the following policies pays 60% and the insured pays 40%, on average?
Bronze
Catastrophic
Gold
Silver
Premiums for the catastrophic policies are the highest and premiums decrease as the levels of coverage increases.
TRUE
FALSE
Which of the following statements are TRUE regarding deductibles?
Deductibles do not apply to preventative care, or wellness benefits, such as mammograms.
Deductibles for health insurance are paid semi-annually.
The insurance company participates in claims sooner with embedded deductibles.
The insured pays the deductible after the insurance company pays the provider.
If the Smith family has a health insurance plan with a 4,000 individival deductible and an 8,000 family deductible. Anthony has spent 4,000 in medical expenses. Because there are other members of the family on the plan, nothing is paid by their insurance company until the family deductible of 8,000 is met. What type of deductible does the Smith family plan have?
Embedded
Non-embedded
Once the insured has reached the maximum out-of-pocket limit, the insurance company will pay 90% of any covered medical expenses.
TRUE
FALSE
Co-insurance is a percentage of the expenses the insurance company will pay once the deductible has been met for covered services.
TRUE
FALSE
The co-pay amount may or may not be applied to the annual deductible or the co-insurance percentage depending on the plan.
TRUE
FALSE
James trips and breaks his ankle and goes to the emergency room. The medical expenses for his broken ankle are 3,500. He pays his deductible, which leaves a balance of 500. His plan features are as follows: 3,000 deductible, 80 30 co-payment for office visits, 200 co-payment for emergency room visits, 5,000 maximum out-of-pocket limits. What amount will the insurance company pay?
$30
$100
$300
$400
Ranita has a medical bill for 1,000. She has met her deductible, and she paid her 200 co-insurance for this bill. Her plan features are as follows: 3,000 deductible, 80 30 co-payment for office visits, 100 co-payment for emergency room visits, and 5,000 maximum out-of-pocket. How much does she have left before she reaches her out-of-pocket maximum?
$1,800
$2,000
$4,600
$5,000
High deductible health plans have a minimum deductible and a maximum out-of-pocket limits.
TRUE
FALSE
Which of the following statements are benefits of health savings accounts?
High deductible health plans have lower monthly premiums than non-high deductible health plans.
Health savings accounts may be available with bronze, silver, or gold plans.
If an owner turns 65, a withdrawal may be used to pay for anything, but it may be taxed.
Health savings accounts may be available through health insurance plans offered by employers.
Funds can be withdrawn tax-free and used to pay for deductibles, co-payments, and co-insurance.
Medicare was established in 1965 as a federally funded program to provide health coverage for people 65 years of age and older, certain disabled people, and anyone who has end-stage kidney disease.
TRUE
FALSE
Which Medicare plan covers inpatient hospital care, inpatient care at a skilled nursing facility care, hospice, and home healthcare?
Medicare Part A
Medicare Part B
Medicare Part C
Medicare Part D
Which Medicare plan provides prescription drug coverage?
Medicare Part A
Medicare Part B
Medicare Part C
Medicare Part D
Which of the following Medicare plans covers physician services, lab services, home healthcare, outpatient services, and costs associated with blood transfusion?
Medicare Part A
Medicare Part B
Medicare Part C
Medicare Part D
Medicare B often includes dental, vision, and hearing coverage as well.
TRUE
FALSE
If the total out-of-pocket value of purchased medications exceeds the plan's initial coverage limit, a coverage gap will be encountered.
TRUE
FALSE
Which of the following statements are TRUE regarding Medicare supplement policies?
All Medicare supplement policies offer different types of coverage.
Claim services, customer service, and premiums differ depending on the company selected. The second and fourth options are true.
Medicare supplement policies pay for services and items Medicare does not cover.
Supplement policies are intended to cover most out-of-pocket costs. The second and fourth options are true.
Medicaid is a program for low income individuals.
TRUE
FALSE
Individuals receiving Medicaid may have limited access to healthcare providers.
TRUE
FALSE
