smc-1126-40-Insurance

v1 Financial Maths, STD2 F1 2016 HSC 27a

Alice is researching insurance options before purchasing a car.

Explain what is covered under each of the following types of car insurance:

• Compulsory third-party insurance (CTP)

• Optional third-party property insurance. (2 marks)

--- 4 WORK AREA LINES (style=lined) ---

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`text(CTP Insurance:)`

`text(This insures a driver against liability)`

`text(if their car injures or kills a person)`

`text(in an accident.)`

`text(Non-compulsory TP Insurance:)`

`text(This insurance covers damage to)`

`text(other people’s property in an accident,)`

`text(but does not cover the driver’s own vehicle.)`

Show Worked Solution

`text(CTP Insurance:)`

♦♦♦ Mean mark 13%.
MARKER’S COMMENT: Again, car insurance causes major issues for students.

`text(This insures a driver against liability)`

`text(if their car injures or kills a person)`

`text(in an accident.)`

`text(Non-compulsory TP Insurance:)`

`text(This insurance covers damage to)`

`text(other people’s property in an accident,)`

`text(but does not cover the driver’s own vehicle.)`

v1 Financial Maths, STD2 F1 2018 HSC 15 MC

Adam was involved in a car accident, and after the investigation, he was found to be the driver at fault.

Which of the following is covered by Adam's compulsory third-party (CTP) insurance?

Cost of repairing a building damaged in the accident
Repairs to Adam's car
Injury to the other driver
Repair cost of the other driver's car

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`C`

Show Worked Solution

`text(CTP insurance covers liability for death or injury)`

♦♦ Mean mark 34%.

`text(to other people, but does not cover property damage.)`

`=>C`

v1 Financial Maths, STD2 F1 2019 HSC 6 MC

Darlene is 26 years old and has only been driving for a year. She purchased comprehensive motor vehicle insurance. The following excesses apply to claims for at-fault motor vehicle accidents.

- Basic excess of $850 for each claim
- An additional age excess of $1600 for drivers under 25 years of age
- An additional age excess of $400 for drivers 25 years of age or over with no more than 2 years driving experience

How much would Darlene be required to pay as excess if she made a claim as the driver at fault in a car accident?

$850
$850 + $400
$850 + $1600
$850 + $1600 + $400

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`B`

Show Worked Solution

`text(Darlene’s excess = 850 + 400)`

`text{($1600 does not apply as Darlene is 26 years old.)}`

`text{($400 applies because she is 25 or older with limited driving experience.)}`

`=> B`

Financial Maths, STD2 F1 2019 HSC 6 MC

Mary is 18 years old and has just purchased comprehensive motor vehicle insurance. The following excesses apply to claims for at-fault motor vehicle accidents.

How much would Mary be required to pay as excess if she made a claim as the driver at fault in a car accident?

$1600
$850 + $400
$850 + $1600
$850 + $1600 + $400

Show Answers Only

`C`

Show Worked Solution

`text(Mary’s excess = 850 + 1600)`

`text{($400 does not apply as Mary is under 25.)}`

`=> C`

Financial Maths, STD2 F1 2018 HSC 15 MC

Sam is the driver at fault in a car accident.

Which of the following is covered by Sam's compulsory third-party (CTP) insurance?

Repairs to Sam's car
Injury to the other driver
Damage to the other driver's car
Cost of repairing a building damaged in the accident

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`B`

Show Worked Solution

`text(CTP insurance covers liability for death or injury)`

♦♦ Mean mark 34%.

`text(to other people, but does not cover property damage.)`

`=>B`

Financial Maths, STD2 F1 SM-Bank 5

Alex is buying a used car which has a sale price of $13 380. In addition to the sale price there are the following costs:

Stamp Duty for this car is calculated at $3 for every $100, or part thereof, of the sale price.
Calculate the Stamp Duty payable. (1 mark)

--- 1 WORK AREA LINES (style=lined) ---
Alex wishes to take out comprehensive insurance for the car for 12 months.

The cost of comprehensive insurance is calculated using the following:

Find the total amount that Alex will need to pay for comprehensive insurance. (3 marks)

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Alex has decided he will take out the comprehensive car insurance rather than the less expensive non-compulsory third-party car insurance.
What extra cover is provided by the comprehensive car insurance? (1 mark)

--- 2 WORK AREA LINES (style=lined) ---

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`$402`
`$985.74`
`text(Comprehensive insurance covers Alex)`
`text(for damage done to his own car as well.)`

Show Worked Solution

♦♦♦ Mean mark 12%
IMPORTANT: “or part thereof ..” in the question requires students to round up to 134 to get the right multiple of $3 for their calculation.

i.	`($13\ 380)/100 = 133.8`

`:.\ text(Stamp duty)`	`= 134 xx $3`
	`= $402`

ii.

`text(Base rate) = $845`

`text(FSL) =\ text(1%) xx 845 = $8.45`

`text(Stamp)`	`=\ text(5.5%) xx(845 + 8.45)`
	`= 46.9397…`
	`= $46.94\ text{(nearest cent)}`

`text(GST)`	`= 10 text(%) xx(845 + 8.45)`
	`= 85.345`
	`= $85.35`

`:.\ text(Total cost)`	`= 845 + 8.45 + 46.94 + 85.35`
	`= $985.74`

♦ Mean mark 34%.

iii.	`text(Comprehensive insurance covers Alex)`
	`text(for damage done to his own car as well.)`

Financial Maths, STD2 F1 2016 HSC 27a

Alice intends to buy a car and insure it.

Briefly describe what each of these types of insurance covers:

• Compulsory third-party insurance (CTP)

• Non-compulsory third-party property insurance. (2 marks)

--- 4 WORK AREA LINES (style=lined) ---

Show Answers Only

`text(CTP Insurance:)`

`text(This insures a driver against liability)`

`text(if their car injures or kills a person)`

`text(in an accident.)`

`text(Non-compulsory TP Insurance:)`

`text(This insurance covers damage to)`

`text(other people’s property in an accident,)`

`text(but does not cover the driver’s own vehicle.)`

Show Worked Solution

`text(CTP Insurance:)`

♦♦♦ Mean mark 13%.
MARKER’S COMMENT: Again, car insurance causes major issues for students.

`text(This insures a driver against liability)`

`text(if their car injures or kills a person)`

`text(in an accident.)`

`text(Non-compulsory TP Insurance:)`

`text(This insurance covers damage to)`

`text(other people’s property in an accident,)`

`text(but does not cover the driver’s own vehicle.)`

Financial Maths, STD2 F1 2015 HSC 25 MC

An insurance company offers customers the following discounts on the basic annual premium for car insurance.

If a customer is eligible for more than one discount, subsequent discounts are applied to the already discounted premium. The combined compulsory third party (CTP) and comprehensive insurance discount is always applied last.

Jamie has three insurance policies, including combined CTP and comprehensive insurance, with this company. He has used this company for 8 years and he has never made a claim.

The basic annual premium for his car insurance is $870.

How much will Jamie need to pay after the discounts are applied?

$482.44
$515.50
$541.60
$557.60

Show Answers Only

`C`

Show Worked Solution

`text(Multi-policy discount)`

`text(New premium)`	`= 870 − (text(15%) xx 870)`
	`= $739.50`

`text(No claim bonus)`

`text(New premium)`	`= 739.50 − (text(20%) xx 739.50)`
	`= $591.60`

`text(Combined CTP bonus)`

`text(New premium)`	`= 591.60 − 50`
	`= $541.60`

`⇒ C`