Future Business Leaders of America (FBLA) Business Calculations Practice Test

Which of the following categories is NOT a classification of car insurance?

1. Comprehensive

2. Replacement

3. Liability

4. Collision

The correct answer is: Replacement

Replacement is not a recognized classification of car insurance. The main types of car insurance typically include comprehensive, liability, and collision coverage. Comprehensive coverage protects against damages to your vehicle that are not caused by a collision, such as theft, vandalism, or natural disasters. Liability insurance covers damages you may cause to another person or their property when you are at fault in an accident. Collision insurance, on the other hand, covers damages to your own vehicle resulting from a collision with another vehicle or an object, regardless of fault. While "replacement" might sound relevant in the context of insurance, it actually does not represent a specific type of coverage. Instead, various forms of coverage such as comprehensive or collision may include provisions for replacing your vehicle under certain circumstances, but none are simply titled "replacement." This distinction clarifies why replacement does not fit within the traditional classifications of car insurance.