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Multiple Choice Quiz
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1
Burglars break into your house and steal your stereo equipment, TV and VCR. Which part of your homeowner's insurance policy should cover the costs of the items you have lost?
A)Building and other structures coverage
B)Personal property coverage
C)Additional living expenses coverage
D)Personal liability and related coverage
E)This would not be covered by your homeowner's insurance policy.
2
Lester McCann is concerned because other students do not appear to be good drivers around the university. He decides to walk to campus so that his car is not damaged. Which risk management strategy is he employing?
A)Risk avoidance
B)Risk reduction
C)Risk assumption
D)Risk shifting
E)None of the above
3
Jack Carter lives in Charleston and knows that in the past there have been earthquakes in the Charleston area. He wants to get insurance coverage against this type of loss. What type of insurance is Jack likely to need to cover this type of loss?
A)Liability insurance
B)An umbrella policy
C)A personal property floater
D)An endorsement
E)None of the above
4
David Black and his best friend are in a car accident with another vehicle and it is David's fault. David and his friend are both injured in the accident. Which part of David's automobile policy would most likely cover the cost of the injuries to David and his friend?
A)Bodily injury liability
B)Medical payments coverage
C)Property damage liability
D)Collision
E)None of the above
5
Your automobile liability coverage is 100/300/50. Which of the following is a true statement about your coverage?
A)$300,000 is the maximum amount that will be paid to any one person in an accident.
B)$100,000 is the maximum amount that will be paid to any one person in an accident.
C)$450,000 is the total amount that will be paid to all people in an accident.
D)$450 is your total deductible for an accident.
E)None of the above are correct statements.
6
Brad Duvall gets married and finds that after he gets married his insurance premiums drop by $300 per year. Which of the following automobile insurance factors is most likely the reason for the decrease?
A)Automobile type
B)Rating territory
C)Driver classification
D)Assigned risk pool
E)None of the above
7
Which of the following is a way you can get a discount on automobile insurance?
A)Take a driver's education class
B)Maintaining good grades in school
C)Insuring two or more cars with the same insurance company
D)Installing an anti-theft device in your car
E)All of the above can qualify you for a discount on automobile insurance.
8
Your ten year old son left his skateboard at the top of the stairs in your house. Your neighbor accidentally steps on it and falls down the steps and gets hurt. This is and example of:
A)A speculative risk.
B)Property damage.
C)Negligence.
D)A collision.
E)None of the above.
9
A(n) _______________ is supplementary personal liability coverage that provides added protection against personal injury claims such as libel, slander defamation of character and invasion of privacy.
A)Personal property floater
B)Umbrella policy
C)Endorsement
D)Subrogation
10
_______________ is an insurance claim settlement method in which the insured receives payment based on the current replacement cost of a damaged or lost item less depreciation.
A)Actual cash value
B)Replacement value
C)Subrogation
D)Medical payments coverage
E)None of the above





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