Answers Personal Finance - EL3403 Buying InsuranceQuestion 8

8

QuizMultiple Choice

Buying Insurance

Question 8 • Personal Finance - EL3403

Fred pays $170 monthly or $2,040 per year for car insurance. Fred’s insurance company will pay a maximum of $50,000 for bodily injury per accident and a maximum of $25,000 for property damage if Fred gets into an accident that he has caused.What is Fred’s total policy limit based on the scenario?

Answer

A

$170

B

$2,040

C

$25,000

D

$75,000

Explanation

Fred’s total policy limit is the combined maximum for bodily injury and property damage: $50,000 + $25,000 = $75,000. The $170 monthly and $2,040 yearly amounts are the insurance premium, not the policy limit. The correct choice is $75,000.

AI-written and checked against the verified answer.

More from this Course

31 verified answers

Mortgages and Home Ownership

20 verified answers

Economic Systems

14 verified answers

Introduction to Economics