International Baccalaureate (IB) Practice Exam

Which of the following is true?

1. Any kind of duplicate insurance coverage is a bad idea.

2. Mortgage life insurance is necessary if you are a homeowner.

3. Pet insurance is a good idea since pet emergencies can be very expensive.

4. You can never be too safe - there is no bad insurance.

The correct answer is: Any kind of duplicate insurance coverage is a bad idea.

The statement that any kind of duplicate insurance coverage is a bad idea holds true because having overlapping insurance policies can lead to unnecessary expenses without providing any additional benefit. For instance, if you have multiple health insurance policies covering the same medical costs, you may end up paying more in premiums without receiving proportional benefits. When evaluating the other options, it's important to recognize that mortgage life insurance, while helpful for some homeowners, is not universally necessary. Homeowners can have alternative coverage options that may offer better terms or cost savings. Regarding pet insurance, while it can be beneficial in covering unexpected veterinary costs, opinions vary on its value depending on factors such as the pet's health and age. Lastly, the idea that one can never be too safe by having as much insurance as possible does not hold true, as excessive insurance can lead to financial strain and does not guarantee better protection. Thus, each of these statements warrants careful consideration rather than being accepted outright as a truth.