Buying Insurance

Question 1

Fred pays $170 monthly or $2,040 per year for car insurance. Fred’s insurance company will pay a maximum of $50,000 for bodily injury per accident and a maximum of $25,000 for property damage if Fred gets into an accident that he has caused.What is Fred’s total policy limit based on the scenario?

Revolt · Accepted Answer

$75,000

Question 2

Which statement best defines the term premium?

Revolt · Accepted Answer

It is a fee paid to an insurance company to purchase coverage.

Question 3

Health insuranceDisability insuranceCasualty insuranceWorker’s compensation

Revolt · Accepted Answer

Health insurance

Question 4

If a driver with an insurance policy drives infrequently, it can

Revolt · Accepted Answer

lower costs.

Question 5

Which example best describes reducing risky behavior?

Revolt · Accepted Answer

only driving during the day

Question 6

Which scenario best describes purchasing property insurance?

Revolt · Accepted Answer

Mitchell buys insurance to protect his new stereo system from theft.

Question 7

compensationdeductiblesliabilitypremiums

Revolt · Accepted Answer

liability

Question 8

What is one benefit of submitting a claim to an insurance company?

Revolt · Accepted Answer

It helps to cover any expenses for a loss.

Question 9

Which are benefits of purchasing insurance? Check all that apply.to gain greater confidence and securityto avoid having to reduce risky behaviorto be prepared for problems or changesto avoid paying costly monthly premiumsto have protection if something goes wrongto avoid receiving compensation or payouts

Revolt · Accepted Answer

to gain greater confidence and security; to be prepared for problems or changes; to have protection if something goes wrong

Question 10

claimcontractpayoutpremium

Revolt · Accepted Answer

claim

Buying Insurance Answers

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