Question

The recipient of assets passed on from the death of a friend or relative
Beneficiary
Insured
The amount you pay monthly, quarterly, semiannually or annually to purchase different types of insurance
Co-pay
Premium
Any insurance with cash value or that combines insurance with investments is a bad idea.
False
True
Which of the following would not be a huge financial risk (and, therefore would not require insurance) if you had a full emergency fund of $500 or more?
A car accident
Your identity gets stolen
A medical emergency
You lose your cell phone
Which of the following is true?
Mortgage life insurance is necessary if you are a homeowner.
You can never be too safe-there is no bad insurance.
Pet insurance is a good idea since pet emergencies can be very expensive.
Any kind of duplicate insurance coverage is a bad idea.
Specific amount of money that you pay when insurance only covers a portion of costs
Out-of-pocket expense
Fee
The purpose of insurance is to:
Develop a savings plan
All of the above
Provide an investment opportunity
Transfer financial risk
Which of the following policies would be a duplicate coverage for your health insurance policy?
Disability insurance
Auto insurance
Cancer and hospital indemnity insurance
Long-term care insurance
Which of the following statements about life insurance is true?
You will always need life insurance.
There is no difference between term and cash value life insurance.
Cash value insurance is normally for life and is more expensive than term life insurance because it funds a savings plan.
Term life insurance should be avoided because the policy will expire and it has no savings plan built into it.
After high school, you should have the following types of insurance: auto, renter’s, health and long- term care insurance
True
False
Which of the following types of insurance is not recommended for a young single adult?
Life insurance
Health insurance
Identity theft protection
Auto insurance

Answer 1

1) Beneficiary

2) Premium

3) False — cash-value (permanent) policies aren’t always bad; they’re just more expensive and include a savings/investment component.

4) You lose your cell phone — a $500 emergency fund would typically cover replacing a phone.

5) Any kind of duplicate insurance coverage is a bad idea

6) Out-of-pocket expense

7) Transfer financial risk

8) Cancer and hospital indemnity insurance — it overlaps with health insurance coverage

9) Cash value insurance is normally for life and is more expensive than term life insurance because it funds a savings plan.

10) False — long-term care insurance isn’t usually needed right after high school.

11) Life insurance — generally not recommended for young, single adults without dependents or significant obligations.