Insurance Car Insurance 2

Question 1

What does 'uninsured motorist coverage' protect you against?

Accepted Answer

Accidents caused by drivers with no insurance

Answer

Uninsured motorist coverage pays for your injuries and damages when the at-fault driver has no liability insurance.

Question 2

Which factor most commonly causes car insurance premiums to increase after a policy renewal?

Accepted Answer

Adding a new driver to the policy

Answer

Adding a new driver, especially a young or inexperienced one, typically raises premiums due to increased risk.

Question 3

What is the purpose of a 'declarations page' in a car insurance policy?

Accepted Answer

It summarizes key policy details like coverage types and limits

Answer

The declarations page is a summary document showing the insured, vehicle, coverage types, limits, and premium amounts.

Question 4

Under a standard auto policy, which situation would typically NOT be covered by collision coverage?

Accepted Answer

Flood damage to your car

Answer

Flood damage is a comprehensive claim, not a collision claim, because it results from a natural event rather than a crash.

Question 5

What does 'subrogation' mean in the context of car insurance?

Accepted Answer

The insurer's right to recover costs from the at-fault party after paying your claim

Answer

Subrogation allows your insurer to sue the at-fault driver or their insurer to recoup money paid out on your behalf.

Insurance Practice Test