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Questions and Answers
What does liability insurance cover?
What does liability insurance cover?
- Damage or injury you cause to others (correct)
- Damage or injury caused by natural disasters
- Damage or injury to your own vehicle
- Damage or injury caused by theft
What is the purpose of an insurance premium?
What is the purpose of an insurance premium?
- To cover the administrative costs of the insurance company
- To generate profit for the insurance company
- To provide financial protection against losses (correct)
- To compensate for uninsured losses
What is a deductible in insurance?
What is a deductible in insurance?
- The amount the insurance company charges for providing coverage
- The maximum amount the insurance company will pay for a claim
- The percentage of the claim that the policyholder is responsible for
- The amount the policyholder pays before the insurance coverage kicks in (correct)
True or false: Insurance is a form of risk management to help protect against financial loss.
True or false: Insurance is a form of risk management to help protect against financial loss.
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True or false: Insurance provides a guarantee of complete protection against all potential risks.
True or false: Insurance provides a guarantee of complete protection against all potential risks.
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True or false: Home insurance covers damage caused by natural disasters such as earthquakes and floods.
True or false: Home insurance covers damage caused by natural disasters such as earthquakes and floods.
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