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Financial Planning Courses: Insurance and Risk Management

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1.
What form of insurance would pay for the costs of assisted living?
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Long-term care insurance. This form on insurance covers costs of caring for you over a long period.
2.
Insurance protects a person from risks.
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False. Insurance cannot protect a person from risk; instead, it protects a person from financial losses caused by risks.
3.
You should only insure property for losses you cannot afford.
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True. Unless you want to deliberately waste money on premiums, you should determine how much financial loss you can afford, then insure only that which you cannot afford. This will help you keep your premiums as low as possible.
4.
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.
5.
It is possible to eliminate all risk in personal finance.
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False. Though it is possible to minimize it, no one has yet succeeded in eliminating risk entirely.