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Financial Planning Courses: Insurance and Risk Management

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1.
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.
2.
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.
3.
How we perceive risk remains the same throughout a person's life, regardless of age or experience.
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False. Usually, the way we understand risk changes as we get older.
4.
When you compare two insurance policies, the one with the higher premium is always better.
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False. A more expensive policy may not be better (or worse) than a less expensive one. They may provide different benefits.
5.
Anything _______ that has an adverse effect on your financial goals is financial risk.
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Unexpected. Financial risk involves events that are unexpected.