Managing Personal Finance

Running head: MANAGING PERSONAL FINANCE
Managing Personal Finance
Name of the Student:
Name of the University:
Author’s Note:

1MANAGING PERSONAL FINANCE
Table of Contents
Answer to question 1:.................................................................................................................2
Part a:.....................................................................................................................................2
Part b:.....................................................................................................................................2
Part c:.....................................................................................................................................2
Answer to question 2:.................................................................................................................3
Part a:.....................................................................................................................................3
Part b:.....................................................................................................................................3
Part c:.....................................................................................................................................3
Answer to question 3:.................................................................................................................4
Part a:.....................................................................................................................................4
Part b:.....................................................................................................................................4
Part c:.....................................................................................................................................5
References and bibliography:.....................................................................................................6

2MANAGING PERSONAL FINANCE
Answer to question 1:
Part a:
1. D. I, II, III and IV
2. D. Bathing, Eating, Dressing, Toileting, Mobility, Transferring
3. A. A temporary policy
4. A. I, II and III
5. A. The right to be compensated for a loss up to the full amount of the loss
6. D. I, II and IV
7. A. The contract accelerates savings growth due to its tax-deferred nature
8. C. An insurer’s acceptance of a person’s application of insurance
Part b:
1. Renewable term insurance is an insurance policy having clause to increase the
insurance coverage period. Convertible term insurance allows the individual to
convert the term insurance policy to a permanent policy.
2. The principle of indemnity, assures the insured to claim for damages up to the actual
damages caused and covered by the insurance agreement.
3. Four main methods of indemnity can be defined as, cash payment, repair, replacement
and reinstatement methods (Chen, 2016).
Part c:
1. House owners’ policy covers the damages caused to the house building by flood, fire,
and other perils whereas, the house holders’ policy covers the damages to the contents
and materials of a house building.
2. Compensation payable = 200,000*(1,200,000/2,000,000) = $120,000