Understanding Insurance Basics for Students

What is the primary purpose of insurance?

• To increase your income

• To protect against financial loss

• To pay more taxes

• To avoid paying bills

Which of the following is a type of insurance?

• Savings account

• Health insurance

• Credit card

• Loan

What does a premium refer to in insurance?

• The amount paid for groceries

• The amount paid for insurance coverage

• The amount borrowed from a bank

• The amount earned from investments

Which insurance covers damage to your car in an accident you caused?

• Life insurance

• Collision auto insurance

• Health insurance

• Renters insurance

What is a deductible in an insurance policy?

• The amount the insurance company pays you

• The amount you pay out of pocket before insurance covers the rest

• The total value of your assets

• The interest rate on your loan

Which type of insurance is required by law for drivers in most states?

• Homeowners insurance

• Auto liability insurance

• Life insurance

• Travel insurance

What does health insurance typically help pay for?

• Car repairs

• Medical expenses

• Home renovations

• Vacation costs

Which of the following is NOT a common type of insurance?

• Life insurance

• Health insurance

• Lottery insurance

• Auto insurance

What is the person called who receives the benefit from a life insurance policy?

• Insurer

• Beneficiary

• Agent

• Adjuster

Which insurance would cover your belongings if they are stolen from your apartment?

• Renters insurance

• Health insurance

• Auto insurance

• Life insurance