Question

Quiz/Survey Quiz Week 4 - Unexpected Events A

Answer 1

1. If you don't pay your car insurance premiums then you'll lose your car insurance and will be driving illegally, you can't drive unless you're insured. The lack of insurance means that in an accident there's going to be a hefty penalty towards the driver in terms of damage and legality. 2. In this case pending on whose at fault your insurance will not cover the damages and the accident will be listed in your records. The penalties will go towards the owner of the vehicle, not whose driving it because the owner is responsible for the car's insurance policy.

Answer 2

1. What happens if you don't pay your car insurance premium for your vehicle?

Your are not insured and are driving illegally.

2. Suppose that you only have liability and comprehensive car insurance and you allow your roommate (who doesn't have car insurance) to drive your car to run an errand. What will likely happen if there is a single-car accident causing moderate damage to your car while your roommate is driving?

Your insurance policy will likely not cover the damages to your car.

3. John, Alyson and Jared all selected identical new cars at the same price. John bought the car with some of his own money and the rest a car loan. Alyson bought the car with cash. Jared leased the car. What is true about their options for car insurance?

Alyson has the option to choose the less expensive liability-only insurance coverage.

4. William pays his $500 premium every 6 months for automobile insurance with collision coverage. His deductible is $750. William caused a minor accident that resulted in $700 of damages to his car and $1,100 of damages to the other car. William's car looks and drives fine and he chooses not to file a claim to repair his car. How much will William pay out-of-pocket to have the other car fixed?

$0

5. When Lisa purchased her house, the mortgage lender required her homeowner's insurance to cover 100% of the loan amount. After many years, Lisa paid off her mortgage. If Lisa decided to comparison shop for homeowner's insurance now, what should the insurance coverage amount be based on…

The market value of the house.

6. How can understanding risk management topics help in everyday life?

All answers are correct.