FINance - Finance 1200 Spring 2010 Test #4 True / False...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
Finance 1200 Spring 2010 Test #4 True / False Questions 1. (p. 310) Personal risks, property risks, and liability risks are types of speculative risks. FALSE 2. (p. 310) The most common method of dealing with risk is to shift, or transfer it to an insurance company or some other organization. TRUE 3. (p. 311) Self-insurance is the process of establishing a monetary fund that can be used to cover the cost of a loss. TRUE 4. (p. 322) Vicarious liability refers to the failure to take ordinary or reasonable care in a situation. FALSE 5. (p. 317) Personal property refers to building and other structures covered by homeowner's insurance. FALSE 6. (p. 317) Personal belongings that have a high value require coverage with a personal property floater. TRUE 7. (p. 317) The purpose of a household inventory is to provide evidence of items covered by home insurance. TRUE 8. (p. 318) Increased liability insurance is available with an umbrella policy. TRUE 9. (p. 322) Replacement cost for settling property insurance claims is less costly than the actual cash value method. FALSE 10. (p. 323) A home made of wood is more expensive to insure than a comparable brick structure. TRUE 11. (p. 326) The 100/300 amounts for bodily injury liability insurance refer to the costs of insurance coverage. FALSE 12. (p. 326) Medical payments automobile insurance coverage pays for the costs of injuries to persons in the driver's vehicle. TRUE 13. (p. 327) Collision coverage pays for damage to your vehicle for such hazards as fire, theft, or wind damage. FALSE 14 . (p. 327) Property damage liability coverage would pay for damage to another vehicle for which you were at fault. TRUE 1
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Finance 1200 Spring 2010 Test #4 Multiple Choice Questions 15. (p. 309) Peril is defined as: A. the refusal by an insurance company to pay for the covered loss. B. the cause of risk. C. the cause of a possible loss. D. an uncertainty as to loss. 16. (p. 309) Defective house wiring is an example of a: A. hazard. B. peril. C. risk. D. speculation. 17. (p. 310) Using a home security system is an example of ____________ risk. A. shifting B. accepting C. reducing D. sharing E. transferring 18. (p. 315) The legal responsibility for the financial cost of another person's losses or injuries is referred to as: A. theft. B. robbery. C. liability. D. assigned risk. E. collusion. 19. (p. 315) If a homeowner leaves toys on stairs that results in injury to a delivery person, this may be ruled as: A. vicarious liability. B. negligence. C. assigned risk. D. umbrella coverage. E. coinsurance. 2
Background image of page 2
Finance 1200 Spring 2010 Test #4 20. (p. 316) The additional living expenses component of a home insurance policy is designed to: A. pay for temporary housing while your home is repaired. B.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 10

FINance - Finance 1200 Spring 2010 Test #4 True / False...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online