Personal Finance Chapter 6

A type of homeowner’s coverage that provides protection for you if someone is injured on your property is called personal liability
Which type of automobile insurance provides coverage against damage to your car if it is hit by another car or turns over? collision
Which type of automobile insurance provides coverage against damage to your car from fire, theft, hail, water, falling objects, or vandalism? comprehensive
All of the following actions would likely help reduce the cost of automobile insurance except driving more during the week and less on weekends
Which of the following types of risk might involve breaking your leg and missing an important event? personal risk
Which of the following risk strategies involves lowering your chances of risk, such as taking lessons to lower your risk of falling while skiing? reducing risks
Which of the following risk strategies involves self-insuring? assuming risks
Which of the following actions would help reduce the cost of health insurance premiums? raising your deductible and copay
Group insurance plans typically have lower premiums than the same plan purchased individually and may be provided by employers
Which of the following policies provides a portion (such as 65 percent) of regular pay for up to 2 years to an insured person who cannot work due to illness or injury? short-term disability
The amount of money you must pay toward your medical expenses before your insurance company begins to pay is called the deductible
Which of the following types of life insurance is also called pure insurance because it does not build cash value? term
Losing money, big or small, is which type of risk? risk of financial loss
The amount you may be required to pay each time you fill a prescriptions is called a copay
Which of the following types of life insurance is the least expensive? term
Which of the following would be considered real property? house
Which of the following provides liability coverage beyond the coverage in your home or auto insurance policy? umbrella policy
The price paid for insurance coverage Premium
A tenant’s policy that protects against the loss of personal property Renter’s insurance
Buying insurance to shift the risk of financial loss to an insurance company Risk Transfer
Setting aside money to be used in the event of injury or loss Self-Insure
Finding ways to lower your chance of incurring a loss Risk Reduction
The person designated to receive money from a life insurance policy Beneficiary
The likelihood of a risk resulting in a loss Probability
Stopping behavior that leads to a risk Risk Avoidance
A physical injury, damage to property, or disappearance of property Loss
A clause in a health insurance policy that provides 100 percent coverage of medical expenses after a certain amount has been paid by the insured Stop-Loss Provision

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