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Exam 10: Managing Property and Liability Risk

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Question 41

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The insurance company carries the burden of proof whenever a property or liability loss occurs.

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Question 42

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Insurance companies often limit or deny coverage if a loss occurs as a result of a moral hazard.

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Residents of certain states such as Florida and Tennessee would be wise to add sinkhole insurance to their homeowner's insurance plan as it is typically not covered in the standard policy.

Individual insurance buyers benefit whether or not they suffer a loss because risk reduction is a benefit.

Comprehensive automobile insurance protects against property damage losses caused by perils other than collision and rollover.

When considering insurance,loss frequency is more important than loss severity.

You have a homeowner's policy that insures no-fault medical payments up to $500 per person.During your daughter's first slumber party,the brass ceiling fan fell and injured your daughter and two of her guests.How much of the following medical expenses will your homeowner's policy pay under medical payments coverage? ​ Daughter $150 First guest $350 Second guest $700 ​

Historically,homeowner's insurance paid only the actual cash value of property damaged or destroyed.

Coverage that appears to be provided in one part of an insurance policy may be denied elsewhere in the same policy.

An insurance application must be approved by the insurance company before any legally binding insurance contract is formed.

Auto insurance coverage is fairly standardized among different companies,but rates vary widely.

Lonnie and Paula have a homeowner's policy with $75,000 coverage and a $250 deductible.Their home recently suffered extensive fire damage in the amount of $50,000.Assuming the replacement value of the home was $85,000,how much will the insurance company pay on this loss?

Installing a smoke detector in your home is an example of loss control.

When a star football running back pays an insurance company to insure his legs,this is an example of​

Risk management is the process of identifying and evaluating situations involving speculative risk to determine and implement the appropriate means for its management.

The insurance agent generally assesses whether a loss is covered and sets the dollar amount the company will pay.

An umbrella-liability policy for liability losses can be affordable ways to follow the large-loss principle when buying insurance.

Personal property stolen from an automobile is covered by homeowner's insurance.

Which of the following HO forms is especially written renters?

The state requirements to prove financial responsibility in case of an auto accident are most often fulfilled through buying ____ insurance.