Smart Money Management: Insurance Lecture 6 Quiz

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Questions and Answers

What is the primary purpose of property insurance?

To pool financial risks associated with property losses (correct)

To recover from catastrophic losses

To prevent natural disasters

To eliminate small financial losses

When was the first modern homeowner's policy sold?

1972

1958 (correct)

1945

1965

What is the definition of 'peril' in the context of insurance?

An intentional act causing damage

An unexpected event causing financial loss (correct)

A natural disaster

An insurance policy

How many main types of residential property insurance policies are there in Malaysia?

3 Signup and view all the answers

What does householder insurance primarily cover?

Fire and theft Signup and view all the answers

What is the purpose of automobile insurance?

To protect against liability claims Signup and view all the answers

What does the Basic fire policy cover?

Loss or damage by fire, lightning, and explosion Signup and view all the answers

When buying comprehensive cover for a house and its contents, which policies should be purchased?

Houseowner policy and householder policy Signup and view all the answers

What does the Houseowner policy not cover?

Loss or damage due to subsidence and landslip Signup and view all the answers

What is the importance of ensuring adequate insurance coverage for a property under financing?

To cover the cost of rebuilding the property in case of loss/damage Signup and view all the answers

What is required if you own a strata-titled property such as an apartment?

To get a copy of the individual certificate of insurance for your property Signup and view all the answers

What does the Householder policy provide coverage for?

Coverage for fatal injury to the insured Signup and view all the answers

What may result in double-insurance according to the text?

Purchasing another houseowner policy for a strata-titled property Signup and view all the answers

What is the responsibility of the company managing a strata-titled property?

To ensure the property has coverage under a master policy Signup and view all the answers

What type of properties require additional insurance if under financing?

Strata-titled properties only Signup and view all the answers

What does the Houseowner policy not cover without payment of additional premiums?

Loss or damage due to riot and strike Signup and view all the answers

Study Notes

Property Insurance

Primary purpose: to protect against financial loss due to damage or destruction of property

History of Insurance

First modern homeowner's policy sold: not specified (but implied to be a historical event)

Key Insurance Concepts

Peril: a risk or cause of loss or damage to property or person

Residential Property Insurance in Malaysia

Main types of policies: not specified (but implied to be multiple)

Householder Insurance

Primarily covers: building and contents of a home
Purchasing comprehensive cover for a house and its contents requires: two policies (Houseowner and Householder)

Automobile Insurance

Purpose: not specified (implied to be different from property insurance)

Basic Fire Policy

Covers: fire-related damage or loss

Importance of Insurance Coverage

Ensuring adequate insurance coverage for a property under financing is important: to avoid financial loss in case of damage or destruction

Strata-Titled Properties

Required insurance: additional insurance coverage for shared facilities and common areas
Company managing a strata-titled property is responsible for: maintaining and insuring shared facilities and common areas

Houseowner Policy

Provides coverage for: building and some risks
Does not cover: certain risks or perils without payment of additional premiums

Double-Insurance

May result from: purchasing duplicate or overlapping insurance policies

Financed Properties

Type of properties that require additional insurance: those under financing

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Description

Test your knowledge on homeowner’s insurance, liability insurance, and automobile insurance. Learn about buying and maintaining insurances, recovering losses, and filing claims.