Question 3 • FL-2102373-Personal Finance and Money Management Honors
Jewel is a 25-year-old non-smoker who is starting a term-life policy. She enjoys reading and likes to walk around the small lake near her house for daily exercise. She lives with her mother who has a history of heart problems.Which factor would negatively impact Jewel's insurance premium?
Answer
A
Jewel is relatively old so her premium may go up.
B
Jewel’s hobbies are high-risk so her premium may go up.
C
Jewel’s lack of physical activity may cause her premium to go up.
D
Jewel’s family’s medical history may cause her premium to go up.
Explanation
Insurers may consider family medical history when assessing the risk of future health problems. Jewel’s mother has a history of heart problems, so that could negatively affect Jewel’s premium. Jewel is only 25, and reading and walking are not high-risk hobbies or signs of inactivity.
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