Financial Planning Courses: Insurance and Risk Management

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1.
Anything _______ that has an adverse effect on your financial goals is financial risk.
Choose wisely. There is only one correct answer.
Unexpected. Financial risk involves events that are unexpected.
2.
The best way to shop for insurance is to buy a policy with the lowest premium.
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False. The premium reflects the benefits offered, so a low-cost policy may not have the same benefits of a higher-premium policy.
3.
Life insurance places a value on a person's _______.
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Earning ability. The purpose of life insurance is to pay benefits that replace one's lost earnings ability if one dies.
4.
There are many ways to manage risks in your financial life. For example, not taking any steps at all to reduce the risk of financial loss is called _______.
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Assuming risk. In this scenario, you assume the risk yourself, along with having to pay for the financial consequences.
5.
An insurance deductible amount is an example of _______.
Choose wisely. There is only one correct answer.
Sharing risk. By sharing risk with an insurer through a co-pay or deductible amount, you can lower your insurance premiums.