Property Insurance Should Correspond to the Actual Value of the Property

question 80

Multiple Choice

Property insurance should correspond to the actual value of the property for all of the following reasons except

• A) if the property is insured for more, the insured will pay too high a premium.
• B) no insurance means no compensation for loss.
• C) if the property is insured for less, the insured will only receive partial compensation.
• D) if the property is insured for less, there is a danger of being a co-insurer.
• E) if the property is insured for more, there will be no compensation for loss.

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Definitions:

Dividend Yield

A ratio that compares the amount a company pays annually in dividends to the price of its shares.

Stock Price

The stock price is the cost of a single share of a number of saleable stocks of a company, derivative, or other financial asset.

Quarterly Dividend

A dividend paid by a company to its shareholders every three months.

Value Weighted

Describes a method of calculating indexes where each component is weighted according to its market value.