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Which of the following is false?

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An insurance policy is a legal contract.

In risk management, you should only buy insurance to cover amounts "at risk."

You can save money by buying only benefits and riders you need.

You should always insure property against loss.

You should always insure property against loss. You should only insure property for losses you cannot afford.

It is possible to eliminate all risk in personal finance.

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True

False

False. Though it is possible to minimize it, no one has yet succeeded in eliminating risk entirely.

Insurance can help you manage _______.

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Risk

Financial loss due to risk

Both of the above

Financial loss due to risk. Insurance is not designed to help you manage risk itself, but rather the financial losses caused by risk.

Insurance is used to manage what?

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All risks

Financial risk

Accidents

Wealth

Financial risk. Insurance is not made to manage the other options. Its purpose is to manage the financial risks that we suffer.

If you take out a loan and then lose your job shortly afterward, what form of insurance would protect you financially if you default on your loan?

Choose wisely. There is only one correct answer.

Homeowner's insurance

Credit insurance

Unemployment insurance

Liability insurance

Credit insurance. Credit insurance is made for scenarios like this.

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