Important Business Insurance Questions!

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AdewumiKoju
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  • 1/10 Questions

    What role does insurance play in financial planning?

    • It guarantees that income and assets are protected 
    • It helps build and maintain one's credit score
    • It helps cover day-to-day expenses
    • It grows in value and appreciates over time
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About This Quiz

Before you start a business, you need to know all about insurance. What to choose, what to do and all that. And if you know all this, then you should take this awesome quiz and test your knowledge with our questions.

Important Business Insurance Questions! - Quiz

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  • 2. 
    What information is not listed on an insurance policy? - ProProfs

    What information is not listed on an insurance policy?

    • Name of person or property being insured

    • Actual Cash Value of the property being insured 

    • Deductible amounts

    • The policy period

    Correct Answer
    A. Actual Cash Value of the property being insured 
    Explanation
    The information that is not listed on an insurance policy is the Actual Cash Value of the property being insured. This refers to the current value of the property, taking into account factors such as depreciation. The insurance policy will typically include details such as the name of the person or property being insured, deductible amounts, and the policy period. However, the actual cash value of the property is not typically listed on the policy.

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  • 3. 
    A policy is a contract between the - ProProfs

    A policy is a contract between the

    • The policyholder and the injured person

    • Driver and the government

    • Consumer and the insurance company 

    • Consumer and the insurance agent

    Correct Answer
    A. Consumer and the insurance company 
    Explanation
    The correct answer is "Consumer and the insurance company". A policy is a contract that is entered into between the consumer (policyholder) and the insurance company. It outlines the terms and conditions of the insurance coverage, including the premiums to be paid and the benefits to be provided. The insurance company is responsible for fulfilling the obligations stated in the policy, such as compensating the consumer for covered losses or damages.

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  • 4. 
    A stone hits your windshield. Which type of coverage would likely cover this expense? - ProProfs

    A stone hits your windshield. Which type of coverage would likely cover this expense?

    • Collision

    • Liability

    • None

    • Comprehensive 

    Correct Answer
    A. Comprehensive 
    Explanation
    Comprehensive coverage would likely cover the expense of a stone hitting your windshield. Comprehensive coverage is designed to cover damage to your vehicle that is not caused by a collision, such as damage from falling objects, fire, theft, vandalism, or natural disasters. Since a stone hitting your windshield is not a collision with another vehicle, comprehensive coverage would be the most appropriate type of coverage to cover this expense.

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  • 5. 
    Which insurance coverage is required by law? - ProProfs

    Which insurance coverage is required by law?

    • Homeowners insurance

    • Auto insurance 

    • Health

    • Disability insurance

    Correct Answer
    A. Auto insurance 
    Explanation
    Auto insurance is required by law in most states. This is because it provides financial protection in case of accidents or damages caused by the insured vehicle. It helps cover medical expenses, property damage, and liability costs. Without auto insurance, drivers may be unable to pay for these expenses, leading to financial hardship for both the driver and the affected parties. Therefore, to ensure the safety and financial security of all parties involved in a car accident, auto insurance is mandated by law.

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  • 6. 
    What factor does not impact the cost of your auto insurance premium? - ProProfs

    What factor does not impact the cost of your auto insurance premium?

    • Deductible amount

    • The vehicle you are insuring

    • Your credit score

    • Your income 

    Correct Answer
    A. Your income 
    Explanation
    The factor that does not impact the cost of your auto insurance premium is your income. Insurance companies typically do not consider a person's income when determining their auto insurance premium. Instead, they focus on factors such as the deductible amount, the vehicle being insured, and the individual's credit score, as these factors are believed to be more indicative of risk.

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  • 7. 
    Which of the following wouldn't save you money on your auto insurance premium? - ProProfs

    Which of the following wouldn't save you money on your auto insurance premium?

    • Decrease your deductible 

    • Reduce or eliminate optional insurance on an older vehicle

    • Maintain a good credit history

    • Bundle your insurance with other policies

    Correct Answer
    A. Decrease your deductible 
    Explanation
    Decreasing your deductible wouldn't save you money on your auto insurance premium because a lower deductible means you would have to pay more out of pocket in the event of an accident or claim. While a lower deductible may provide more immediate financial relief in the case of an incident, it generally results in higher insurance premiums. Therefore, it is not a strategy that would save you money on your auto insurance premium.

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  • 8. 
    This professional analyzes statistics and uses them to calculate risks and premiums. - ProProfs

    This professional analyzes statistics and uses them to calculate risks and premiums.

    • Agent

    • Actuary 

    • Claims Clerk

    • Underwriter

    Correct Answer
    A. Actuary 
    Explanation
    An actuary is a professional who analyzes statistics and uses them to calculate risks and premiums. Actuaries work in insurance companies and other financial institutions, using mathematical models and statistical techniques to assess the likelihood of certain events occurring and determine the financial impact of those events. They play a crucial role in setting insurance premiums, determining the amount of risk that an insurance company is willing to take on, and ensuring the financial stability of the company. Actuaries also provide expertise in areas such as pension plans and investment strategies.

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  • 9. 
    Your health insurance copay is - ProProfs

    Your health insurance copay is

    • Amount paid out of pocket before your insurance coverage

    • Paid by the insurer

    • Applied on an annual basis

    • A fixed amount of money you pay each time you use your plan 

    Correct Answer
    A. A fixed amount of money you pay each time you use your plan 
    Explanation
    A copay is a fixed amount of money that you are required to pay each time you use your health insurance plan. It is an out-of-pocket expense that you must pay before your insurance coverage kicks in. This fixed amount is typically determined by your insurance provider and can vary depending on the type of service or treatment you receive. Copays are not applied on an annual basis, but rather each time you use your insurance plan.

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  • 10. 
    Which of the following would be covered under a renter's insurance policy? - ProProfs

    Which of the following would be covered under a renter's insurance policy?

    • Damage to the exterior of the property

    • Medical bills of another person who is injured on the property 

    • Your roommate's personal belongings in the rental unit

    • Damage to a detached shed on the property

    Correct Answer
    A. Medical bills of another person who is injured on the property 
    Explanation
    A renter's insurance policy typically covers the personal belongings of the renter, liability for injuries to others that occur on the property, and damage to the rental unit caused by specific events such as fire or theft. In this case, the correct answer is "Medical bills of another person who is injured on the property" because it falls under the liability coverage provided by a renter's insurance policy. This coverage would help pay for medical expenses if someone is injured on the property and the renter is found to be at fault.

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Quiz Review Timeline (Updated): Mar 21, 2023 +

Our quizzes are rigorously reviewed, monitored and continuously updated by our expert board to maintain accuracy, relevance, and timeliness.

  • Current Version
  • Mar 21, 2023
    Quiz Edited by
    ProProfs Editorial Team
  • Jul 06, 2019
    Quiz Created by
    AdewumiKoju
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