| The uncertainties of direct and indirect losses to personal or real property due to fire, wind, accident, theft, etc., are called ____________ risks. | property |
| Defective house wiring is an example of a | hazard |
| Possible losses due to negligence resulting in bodily harm or property damage to others are called ____________ risks. | liability |
| Starting a small business that may or may not succeed is an example of ___________ risk. | speculative |
| The legal responsibility for the financial cost of another person’s losses or injuries is referred to as | liability |
| If a homeowner leaves toys on stairs that results in injury to a delivery person, this may be ruled as | negligence. |
| Negligence refers to | failure to take ordinary and reasonable care. |
| While cleaning your home, a worker damages some furniture. You take action against the worker’s employer to cover the cost of the damage. This is an example of a(n) ____________ liability. | vicarious |
| The additional living expenses component of a home insurance policy is designed to | pay for temporary housing while your home is repaired. |
| Georgette Valentine has expensive photography equipment for use in her hobby. Which of the following coverages would pay for damage or theft of this equipment? | a personal property floater |
| The ____________ coverage of a home insurance policy would cover accidental damage to another person’s property by a member of your family. | personal liability |
| An umbrella policy is designed to cover | major personal liability suits. |
| Most home insurance policies provide coverage for | medical payments. |
| Renter’s insurance would include coverage for | personal |
| Which of the following are not covered by renter’s insurance? | fire damage of the building’s roof |
| Which form of homeowner’s policy provides coverage for the most risks? | special |
| Kelly and Bob Walton recently purchased a new home and desire coverage for all causes of loss or damage except those specially excluded by the policy. They should obtain the ____________ form of homeowner’s policy. | special |
| Tara Guest owns a home in Edmond, Oklahoma. She is worried about a tornado causing damage to her home. The tornado is an example of: | A peril |
| Your home insurance provides for replacement value for personal property losses. A microwave is stolen. It cost $300 two years ago and has an expected life of six years. A comparable microwave costs $400 today. What amount will the insurance company pay? | $400 |
| Which of the following insurance policy provisions requires that the insured must pay for part of the loss of a claim if the property is not insured for the specified percentage of replacement value? | coinsurance clause |
| The ____________ method to settle claims is based on the current replacement cost of a damaged or lost item less depreciation. | actual cash value |
| Home insurance costs are affected most directly by | the number of claims in an area. |
| Your home insurance policy has a $250 deductible. If a small fire causes $600 damage to your home, what amount of the claim would the insurance company pay? | $350 |
| The purpose of financial responsibility laws is to | protect the public from financial losses due to auto accidents. |
| The 100 in 100/300/50 refers to | the limit for bodily injury claims that can be paid to one person. |
| Henry Edwards was injured in an accident caused by another driver who did not have insurance. Henry’s medical expenses would be covered by | uninsured motorists protection. |
| Which of the following is a system in which drivers involved in an accident collect medical expenses, lost wages, and related injury costs from their own insurance company? | no-fault insurance |
| Comprehensive coverage would cover financial losses due to | damage to your car caused by wind or hail. |
| Thad Joslin was judged at fault in an automobile accident. Three others were awarded damages of $150,000, $75,000, and $75,000. Thad has 100/300 bodily injury liability coverage. What amount, if any, would not be covered by his insurance? | $50,000 |
| Your geographic location is a major factor in determining the ____________ used to calculate your automobile insurance premiums. | rating territory |
| Wind damage occurs to your car costing $800 to repair. If you have a $100 deductible for collision and full coverage for comprehensive, what portion of the claim will the insurance company pay? | $800 |
| Which of the following refers to a category based on age, sex, marital status, and driving habits that is used to set automobile insurance premiums? | driver classification |
| Which of the following factors is used to determine a person’s driver classification? | age |
| The purpose of an assigned risk pool is to | provide insurance for poor drivers. |
| A system that requires each insurance company operating in a state to provide coverage to several individuals with poor driving records is referred to as | an assigned risk pool. |