Post-Test
Post-Test
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 1 The premium is the payment(s) that is made to pay for cost of insurance policy. A) True B) False 2 Term insurance would pay face amount of policy in case of death of insured. A) True B) False 3 Premiums for straight-life are higher than for term insurance. A) True B) False 4 The premium for fire insurance is found by the insured value divided by 100 times the table rate. A) True B) False 5 The actual amount of insurance carried is called the face value. A) True B) False 6 All states have the same compulsory insurance. A) True B) False 7 Lowering deductibles for collision will result in increased premiums. A) True B) False 8 In terms of premium cost, the most expensive type of insurance is: A) Term B) Straight-life C) 20-payment life D) 20-year endowment E) None of the above 9 An auto insurance premium may be partially based on: A) Attitude of driver B) Expected life of car C) Make of car D) Number of years one expects to drive a car E) None of the above 10 Abby Kaminsky, age 32, has decided to take out a limited payment life policy. She chose this since she expects her income to decline in future years. Abby has decided to take out a twenty-year pay life policy with a coverage amount of \$200,000. By using the tables in the handbook, her annual premium will be: A) \$1,158 B) \$2,316 C) \$2,136 D) \$1,518 E) None of the above 11 Matt Miller, age 28, took out \$100,000 of straight-life insurance. His annual premium was \$418.20. At the end of 20 years, the cash value of his policy is: (Use the tables in the handbook) A) \$13,250 B) \$26,000 C) \$26,500 D) \$30,000 E) None of the above 12 Bill Blum insured his hardware store with a fire insurance policy for \$88,000 at a cost of \$.84 per \$100. Ten months later his insurance company canceled his policy, resulting from failure to correct fire hazard. The cost of the policy to Bill was: A) \$739.20 B) \$793.20 C) \$591.36 D) \$616.00 E) None of the above