Question

1. On a depreciating asset most likely the insurance premium would be higher for

A	A replacement cost policy

B	A value based policy

C	This make no difference

D	High deductible policy

2. High insurance deductible usually means:

A	lower premiums

B	Higher premiums

C	No difference in premium

D	you are willing to take on more risk

3. Evaluating insurance coverage needs involves

A	Looking at the costs verses the potential for exposure

B	Only getting coverage that is required by the contract

C	Only getting coverage required by law

D	Speaking to the owner and covering what they want

Answer 1

1. A replacement cost policy (Becuase a replace the asset fully at the present cost and would require more premium)

2. A: lower premiums ( A higher deductible will always result in lower premiums becuase the amount to pay in case of claim will be lower)

3: D: Speaking to the owner and covering what they want ( Evaluating the needs of the customer annd identifying the need based coverage)