Question

a. Individuals renting out rooms in their home for overnight stays, individuals jointly owing a car with other owners, and individuals who give rides to people who call or text them are creating “new” liability exposures for insurers. The social change that creates these new liability exposures is called.... why?

	A.	The sharing economy
	B.	The millennial generation
	C.	The greying of America
	D.	The baby boom factor

b. All of the following are considered to be a covered auto under the Personal Auto Policy EXCEPT... why?

	A.	A motorcycle owned by the insured.
	B.	A trailer owned by the insured.
	C.	A temporary substitute auto loaned to the insured while her care is being repaired.
	D.	A newly acquired auto

c. Some states do not require an individual to demonstrate the ability to pay an automobile liability claim until after the individual has been involved in an accident or has been convicted for certain offenses, such as driving under the influence of alcohol. This approach to dealing with compensating innocent auto accident victims is called a(n) ... why?

	A.	Unsatisfied judgement fund
	B.	Financial responsibility law
	C.	Uninsured motorist law
	D.	Compulsory insurance law

d. Which statement is true with regard to problems and issues with tax-deferred retirement plans in the United States? why?

	A.	Inadequate participation in employer-sponsored retirement plans can create economic insecurity for retired employees.
	B.	Retirement benefits for women are higher than retirement benefits for men, reflecting the higher wages women are paid.
	C.	Employees do not invest sufficient amounts in the common stock issued by the companies where they work.
	D.	Pension benefits are too often indexed for inflation, burdening employers with high pension costs

Answer 1

A. This social change that creates new liability exposures is called the sharing economy. This is because in sharing economy, people share their goods and services with other people in order to reduce their expenses and also do a bit for the environment. This allows the people to share costs with others and reduce burden on their pockets.

B. All of the following are covered auto under Personal Auto Policy except a temporary substitute auto loaned to the insured while her car is being repaired. This is because the temporary substitute is not owned by the insured and is being provided as a replacement temporarily to the insured and hence cannot be covered under Personal Auto Policy.

C. This approach to dealing with compensating innocent auto accident victims is called Uninsured Motorist Law. Such a law prevents the motorists who are innocent and have not committed accidents knowingly from paying up. In order to prevent innocent motorists, this law has been put in place which compensates such motorists even if they are uninsured.

D. Below statement is true :

Inadequate participation in employer sponsored retirement plans can create economic insecurity for retired employees. This is because retired employees do suffer from lack of participation of employers in sponsoring such plans and hence their retiral benefits are inadequate and less. Such things need to be taken care of in the long term for providing of proper benefits to retired people.