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1.The “insurable interest” section of a homeowners policy means that an insured

ID: 443928 • Letter: 1

Question

1.The “insurable interest” section of a homeowners policy means that an insured is only covered up to the amount of his or her ownership interest in the property. T/F

2. A homeowners policy may place “special limits” on the amount of coverage for certain types of property. T.F

3. With no-fault auto insurance, a policyholder receives compensation for a claim from his or her own insurer, regardless of who caused the accident. T/F

4.Liability coverage is generally the most important part of an automobile policy.T/F

5. A tort is a private wrong that is prosecuted by the government.T/F

Explanation / Answer

1. T

People have an insurable interest in their homeownerss policy up to the value of the property, but not more than that.

2. T

It depends on the coverageplan and the type of coverage adopeted. Some coverage do place limits on type of coverages.

3. T

But in its strictest form no-fault applies only to state laws that both provide for the payment of no-fault first-party benefits and restrict the right to sue, the so-called “limited tort” option. PIP os the personal injury protection.

4. T

Liability coverage is to protect someone in case he causes an injury or damage to the third party and cover the damages.

5. F

A tort is an act which injures/damages someone in some or the other way, and for which the injured person has the rights to sue the wrongdoer for all the injuries and damages.