LOUISIANA MOTOR VEHICLE PHYSICAL DAMAGE
INSURANCE EXAM QUESTIONS AND CORRECT
ANSWERS (VERIFIED ANSWERS) Q&A 2027
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1. What is the primary purpose of automobile physical
damage insurance?
A. To cover bodily injury to passengers
B. To cover damage to the insured automobile
C. To pay medical expenses of pedestrians
D. To provide life insurance
Rationale: Physical damage coverage addresses loss or damage
to the insured automobile rather than bodily injury liability.
Correct Answer: B. To cover damage to the insured automobile
2. Which coverage generally applies when an insured vehicle
is damaged by collision with another vehicle?
A. Collision coverage
B. Medical payments coverage
C. Uninsured motorist coverage
D. Bodily injury liability
Rationale: Collision coverage addresses loss or damage
resulting from collision or upset.
,Correct Answer: A. Collision coverage
3. Which coverage generally protects against theft of an
automobile?
A. Collision
B. Comprehensive
C. Bodily injury liability
D. Medical payments
Rationale: Comprehensive coverage generally addresses
physical damage causes other than collision, including theft.
Correct Answer: B. Comprehensive
4. A vehicle strikes a stationary tree. Which physical damage
coverage generally applies?
A. Collision
B. Comprehensive
C. Liability
D. Uninsured motorist
Rationale: Impact with a stationary object is ordinarily
considered a collision loss.
Correct Answer: A. Collision
5. Which event is most commonly associated with
comprehensive coverage?
A. Collision with another car
B. Theft
C. Damage to another driver's vehicle
D. Bodily injury to a pedestrian
,Rationale: Comprehensive coverage generally applies to
specified noncollision physical damage causes such as theft.
Correct Answer: B. Theft
6. What is a deductible?
A. The insurer's profit
B. The amount the insured pays toward a covered loss before
insurance responds
C. The policy premium
D. The vehicle's purchase price
Rationale: A deductible is the portion of a covered loss retained
by the insured under the policy.
Correct Answer: B. The amount the insured pays toward a
covered loss before insurance responds
7. If a policy has a $500 collision deductible and a covered
collision causes $4,000 in damage, what is the basic claim
amount before other policy considerations?
A. $500
B. $3,000
C. $3,500
D. $4,500
Rationale: $4,000 minus the $500 deductible equals $3,500.
Correct Answer: C. $3,500
8. Which term describes the amount paid to obtain insurance
coverage?
, A. Deductible
B. Premium
C. Salvage
D. Depreciation
Rationale: A premium is the amount charged for insurance
coverage.
Correct Answer: B. Premium
9. What does actual cash value generally consider?
A. Only the original purchase price
B. Replacement cost without depreciation
C. Value considering depreciation and applicable valuation
factors
D. The insured's preferred selling price
Rationale: Actual cash value commonly reflects the property's
value after consideration of depreciation.
Correct Answer: C. Value considering depreciation and
applicable valuation factors
10. What is depreciation?
A. An increase in an automobile's value
B. A reduction in value due to age, wear, or obsolescence
C. A policy deductible
D. A premium surcharge only
Rationale: Depreciation reflects loss of value associated with
age, use, wear, and other factors.
INSURANCE EXAM QUESTIONS AND CORRECT
ANSWERS (VERIFIED ANSWERS) Q&A 2027
|INSTANT DOWNLOAD PDF
1. What is the primary purpose of automobile physical
damage insurance?
A. To cover bodily injury to passengers
B. To cover damage to the insured automobile
C. To pay medical expenses of pedestrians
D. To provide life insurance
Rationale: Physical damage coverage addresses loss or damage
to the insured automobile rather than bodily injury liability.
Correct Answer: B. To cover damage to the insured automobile
2. Which coverage generally applies when an insured vehicle
is damaged by collision with another vehicle?
A. Collision coverage
B. Medical payments coverage
C. Uninsured motorist coverage
D. Bodily injury liability
Rationale: Collision coverage addresses loss or damage
resulting from collision or upset.
,Correct Answer: A. Collision coverage
3. Which coverage generally protects against theft of an
automobile?
A. Collision
B. Comprehensive
C. Bodily injury liability
D. Medical payments
Rationale: Comprehensive coverage generally addresses
physical damage causes other than collision, including theft.
Correct Answer: B. Comprehensive
4. A vehicle strikes a stationary tree. Which physical damage
coverage generally applies?
A. Collision
B. Comprehensive
C. Liability
D. Uninsured motorist
Rationale: Impact with a stationary object is ordinarily
considered a collision loss.
Correct Answer: A. Collision
5. Which event is most commonly associated with
comprehensive coverage?
A. Collision with another car
B. Theft
C. Damage to another driver's vehicle
D. Bodily injury to a pedestrian
,Rationale: Comprehensive coverage generally applies to
specified noncollision physical damage causes such as theft.
Correct Answer: B. Theft
6. What is a deductible?
A. The insurer's profit
B. The amount the insured pays toward a covered loss before
insurance responds
C. The policy premium
D. The vehicle's purchase price
Rationale: A deductible is the portion of a covered loss retained
by the insured under the policy.
Correct Answer: B. The amount the insured pays toward a
covered loss before insurance responds
7. If a policy has a $500 collision deductible and a covered
collision causes $4,000 in damage, what is the basic claim
amount before other policy considerations?
A. $500
B. $3,000
C. $3,500
D. $4,500
Rationale: $4,000 minus the $500 deductible equals $3,500.
Correct Answer: C. $3,500
8. Which term describes the amount paid to obtain insurance
coverage?
, A. Deductible
B. Premium
C. Salvage
D. Depreciation
Rationale: A premium is the amount charged for insurance
coverage.
Correct Answer: B. Premium
9. What does actual cash value generally consider?
A. Only the original purchase price
B. Replacement cost without depreciation
C. Value considering depreciation and applicable valuation
factors
D. The insured's preferred selling price
Rationale: Actual cash value commonly reflects the property's
value after consideration of depreciation.
Correct Answer: C. Value considering depreciation and
applicable valuation factors
10. What is depreciation?
A. An increase in an automobile's value
B. A reduction in value due to age, wear, or obsolescence
C. A policy deductible
D. A premium surcharge only
Rationale: Depreciation reflects loss of value associated with
age, use, wear, and other factors.
