What's Your Insurance IQ?

Think you know all you need to know about Insurance?  According to the National Association of Insurance Commissioners (NAIC) the majority of Americans believe they are smart about insurance, but a deeper look at the issue tells a different story.  How insurance savvy are you?

Test your knowledge with these questions :

1. Auto rates are the same in every state.

A. True                 B.   False

2. What factors can affect your auto insurance?

A. Your age and marital status

B. Where you live and how you use your vehicle

C. Your accident history and safety features on your car

D. Your credit based insurance score

E. All of the above can affect your policy, depending on the type of coverage and the state in which you live

3. If you have personal auto insurance, will it always cover a rental car?

A. Yes B.  No

4. If you let a friend drive your car and he or she is at fault in an accident, does your personal auto policy cover damage to the other vehicle?

A. Yes, coverage typically extends to the permitted user of the car.

B. No, my friends insurance covers it.

5. What kind of insurance provides coverage if a person is injured in an accident and decides to file a lawsuit?

A. Liability coverage associated with auto and homeowners insurance

B. An Umbrella Policy

C. A personal Catastrophe Liability Policy

D. All of the above

6. What type of life insurance is less expensive, but only lasts a particular length of time?

A. Term life B.   Whole Life

C.    Universal life D.  All of the above

7. In general,, how much life insurance should I have?

A. Half your annual salary B. Two times your annual salary

B. 5-7 times your annual salary D.  10 times your annual salary

8. If you operate a small business out of your home, will your homeowners policy automatically cover any damage to your equipment (computer, supplies, etc.) and any liability exposure associated with the business?

A. Yes B.     No C.     It may provide limited coverage

9.    A flood has recently left several inches of water in your house.  Does your homeowners insurance cover the damages?

A. Yes B.    No

10. Can your insurance help if someone has stolen your identity of your credit card?

A. Yes B.  No C.   Maybe

Answers:  1-b, 2-e, 3-b,4-a,5-d,6-a,7-c,8-c,9-b,10-c  

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