State Farm Auto Insurance IQ Quiz

1. Teen drivers with good grades in school may pay less for auto insurance than those with not-so-good grades

True

False

Teen drivers with good grades in school may pay less for auto insurance because insurance companies often offer discounts to students who demonstrate responsible behavior and good academic performance. This is because students with good grades are typically seen as more responsible and less likely to engage in risky driving behaviors. Insurance companies believe that these students are more likely to be cautious and responsible drivers, reducing the likelihood of accidents and insurance claims. Therefore, they offer lower rates to incentivize and reward good academic performance.

Explanation

Teen drivers with good grades in school may pay less for auto insurance because insurance companies often offer discounts to students who demonstrate responsible behavior and good academic performance. This is because students with good grades are typically seen as more responsible and less likely to engage in risky driving behaviors. Insurance companies believe that these students are more likely to be cautious and responsible drivers, reducing the likelihood of accidents and insurance claims. Therefore, they offer lower rates to incentivize and reward good academic performance.

2. No-fault coverage under a car insurance policy means:

The accident wasn’t my fault!

The other party will pay for all damages

Your insurance company will pay for reasonable medical treatment for injuries sustained as a result of an accident

No one pays for anything

No-fault coverage under a car insurance policy means that regardless of who is at fault in an accident, your insurance company will pay for reasonable medical treatment for injuries sustained as a result of the accident. This means that you don't have to prove fault or wait for the other party's insurance to cover your medical expenses. Instead, your own insurance company will take care of your medical bills up to a certain limit specified in the policy.

Explanation

No-fault coverage under a car insurance policy means that regardless of who is at fault in an accident, your insurance company will pay for reasonable medical treatment for injuries sustained as a result of the accident. This means that you don't have to prove fault or wait for the other party's insurance to cover your medical expenses. Instead, your own insurance company will take care of your medical bills up to a certain limit specified in the policy.

3. In their first year on the road, how likely are teens to get into an accident, compared to adult drivers?

5 times more likely

10 times more likely

20 times more likely

Teens are 10 times more likely to get into an accident in their first year on the road compared to adult drivers. This means that the risk of accidents for teenagers is significantly higher than that of adults. It suggests that teens may have less experience, maturity, and judgment when it comes to driving, which increases the likelihood of accidents occurring.

Explanation

Teens are 10 times more likely to get into an accident in their first year on the road compared to adult drivers. This means that the risk of accidents for teenagers is significantly higher than that of adults. It suggests that teens may have less experience, maturity, and judgment when it comes to driving, which increases the likelihood of accidents occurring.

4. The definition of an insurance deductible is:

The amount of money you pay when you make a claim

The balance between the cost of your claim and the amount of coverage your policy holds

The amount of money you get as a refund when you don’t make any claims on your policy

The part of a covered loss that you have agreed to pay with your own money

An insurance deductible refers to the portion of a covered loss that an individual has agreed to pay using their own funds. This means that when a claim is made, the policyholder is responsible for paying a certain amount before the insurance company covers the remaining cost. The deductible acts as a form of self-insurance, where the policyholder assumes some financial responsibility in the event of a loss.

Explanation

An insurance deductible refers to the portion of a covered loss that an individual has agreed to pay using their own funds. This means that when a claim is made, the policyholder is responsible for paying a certain amount before the insurance company covers the remaining cost. The deductible acts as a form of self-insurance, where the policyholder assumes some financial responsibility in the event of a loss.

5. Which model of car had the highest frequency of theft claim in 2009?

Ford Taurus

Audi A8

Toyota Camry

Cadillac Escalade

The Cadillac Escalade had the highest frequency of theft claim in 2009.

Explanation

The Cadillac Escalade had the highest frequency of theft claim in 2009.

6. What percentage of teens rely on their parents to teach them to drive?

77%

40%

56%

90%

56% of teens rely on their parents to teach them to drive. This means that more than half of teenagers depend on their parents for driving lessons. It suggests that parental involvement is crucial in teaching teenagers how to drive, highlighting the importance of parental guidance and support during this learning process.

Explanation

56% of teens rely on their parents to teach them to drive. This means that more than half of teenagers depend on their parents for driving lessons. It suggests that parental involvement is crucial in teaching teenagers how to drive, highlighting the importance of parental guidance and support during this learning process.