Insurance MCQ

What are car "Tabs," how often do you buy them and how much do they cost? Answer: Tabs are the stickers that you buy that go on your licenses plate. They need to be purchased every year and are essentially a tax. The more expensive your car, the more the tabs cost. As your car ages, the price goes down.

What is the DMV and where is it located it? Answer: The Department of Motor Vehicles and it is almost always found in City Hall.

Why is helpful to show up at a car dealer with financing (proof that you will qualify for a loan) in place? Answer: Because you will be able to use it to negotiate a better price.

How should you choose an Insurance Agent? Answer: Ask people you know and trust whom they recommend.

What are some things that you should pay attention to when test driving a used car? Answer: Sounds, smells, noises, how does it feel to drive, how are the breaks, how is the steering and alignment.

What are some other expenses that come up as you purchasing a car? Answer: License, Registration and Sales Tax.

If you have a loan for your car and you miss payments, what can/will happen? Answer: Your car will be repossessed.

Why should you shop several places for a loan? Answer: Because you might get a smaller interest rate which will save you money.

What is the problem with really long term loans (60 months or 72 months)? Answer: You may much more in interest and buy the time you actually own the car, it will be quite used and have high mileage - you have less time to own it outright.

What is one law that will protect you if you buy a car without a warranty and several things go wrong in the first few months? Answer: Lemon Laws

When might you want to buy an Extended Warranty or Interior/Exterior Protection? Answer: If you plan to keep the car for a very long time, if you have kids, if you drive on gravel roads, if you use your car for work and are in it a lot.

When you have a loan for your car, who owns the car? Answer: The bank.

Why does part of your insurance cover other Uninsured Drivers? Answer: So that if you get in an accident with an uninsured driver your insurance will cover your expenses even it it is the other drivers fault.

What are several things you should do to help your negotiations with a car dealer? Answer: Shop at the end of the month, buy from what they have in stock, walk away at least once, bring along someone who act negative, know your budget and stick to it, never tell the dealer how much you plan to spend, separate the buying, trade-in and financing deals, do your research ahead of time so you know what a fair price is!

What is the difference between Standard and Extra Options on a car? Answer: Standard Options are what come with any model of the car you want to buy. Extras are things that you have to pay additional money for such as a sun roof, leather seats, heated seats, remote start, roof rack , 4 wheel drive and so on.

What are things besides warranties that car dealers will try and sell you? Answer: Interior protection and rust proofing/exterior protection.

What are four things that impact the cost of car insurance? Answer: The Driver's gender, age, driving record, zip code, car make, model & year, grades,

What is a deductible in insurance language? Answer: It is the amount that you owe up front any time you need insurance to cover an expense.

What is Comprehensive Insurance Coverage? Answer: It is insurance that covers all of the cars, property and people involved when there is an accident, bad weather, a theft or vandalism.

What is Liability Insurance? Answer: This insurance only covers damage to the other persons' car, property or body. It does not cover your vehicle.