#1
What type of insurance provides coverage for damage or loss to your own vehicle?
Collision insurance
ExplanationCoverage for damage or loss to your own vehicle.
#2
Which of the following types of insurance typically covers damage to your home from fire, theft, and vandalism?
Homeowners insurance
ExplanationCoverage for damage to your home from specified perils.
#3
Which of the following is a type of liability insurance?
Professional liability insurance
ExplanationProfessional liability insurance is a type of liability insurance.
#4
Which of the following is typically covered under a comprehensive auto insurance policy?
Damage caused by fire or theft
ExplanationCoverage for damage from fire or theft.
#5
Which of the following is NOT a type of property insurance?
Auto insurance
ExplanationAuto insurance is not a type of property insurance.
#6
Which of the following types of insurance typically covers damage to someone else's property?
Liability insurance
ExplanationCoverage for damage to someone else's property.
#7
In insurance terms, what does 'deductible' refer to?
The amount the insured person pays out of pocket before the insurance coverage kicks in
ExplanationOut-of-pocket amount paid before insurance coverage starts.
#8
What type of insurance provides coverage for medical expenses and lost wages resulting from a workplace injury?
Workers' compensation insurance
ExplanationCoverage for medical expenses and lost wages from workplace injuries.
#9
Which of the following is NOT a type of life insurance?
Property insurance
ExplanationProperty insurance is not a type of life insurance.
#10
What does 'actuarial risk' refer to in insurance?
The risk of financial loss calculated by actuaries
ExplanationRisk of financial loss calculated by actuaries.
#11
What is 'coinsurance' in insurance terminology?
A clause requiring the insured to share a portion of the covered losses
ExplanationInsured's sharing of covered losses.
#12
Which of the following is NOT a factor that influences insurance premiums?
Height and weight
ExplanationHeight and weight do not typically influence insurance premiums.
#13
What does the term 'policy limit' refer to in insurance?
The maximum amount the insurance company will pay for a covered loss
ExplanationMaximum amount insurer pays for a covered loss.
#14
What is the purpose of reinsurance in the insurance industry?
To insure against catastrophic losses
ExplanationInsuring against catastrophic losses.
#15
Which type of insurance provides coverage for legal expenses resulting from a lawsuit?
Legal expense insurance
ExplanationCoverage for legal expenses from lawsuits.
#16
What does 'subrogation' mean in the context of insurance?
The right of an insurer to pursue a third party for damages paid to the insured
ExplanationInsurer's right to pursue damages from a third party.
#17
What is 'underwriting' in the context of insurance?
The process of evaluating and determining the risk of insuring a potential policyholder
ExplanationProcess of evaluating risk for insuring a potential policyholder.
#18
What is 'adverse selection' in insurance?
The tendency for higher-risk individuals to seek insurance coverage
ExplanationTendency for higher-risk individuals to seek insurance.