A Replacement Cost Rider Is Important to Add to Your

question 136

Multiple Choice

A replacement cost rider is important to add to your homeowner's policy because

• A) it replaces property that breaks or otherwise stops working.
• B) in the event of a loss, your property is valued at the cost of replacement regardless of age or depreciation.
• C) it will pay you depreciated value plus inflation for your property loss.
• D) it is not important and is an expensive but low value rider.

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Definitions:

Accurate Predictions

Forecasts or expectations about future events that are precise and conform closely to actual occurrences.

General Public

A broad term that refers to the undifferentiated masses or the community at large without any specific distinctions.

Confidence

The feeling or belief that one can rely on someone or something; firm trust.

Functional Fixedness

A cognitive bias that limits a person's ability to use an object only in the way it is traditionally used.