Most Americans flunk when it comes to basic insurance knowledge, according to a recent survey conducted for the National Association of Insurance Commissioners (NAIC). Despite this, about 56% of the survey respondents felt "very confident" about making insurance decisions. In a 10-question insurance quiz, the average score was a dismal 40%.
But wait - before you learn more about the results of the survey, why not take the insurance IQ Test yourself and see how you fare?
Having a basic knowledge of insurance can mean the difference between overpaying for coverage and saving money. Misconceptions can also mean that a buyer doesn't secure adequate coverage to protect them in the event of a loss. For example, only 4 in 10 respondents knew that auto insurance doesn't automatically cover a rental car and only 14% were aware of the amount of life insurance that is typically recommended.
Given the test results, it is fortunate to learn that 61% of the respondents said that they use an insurance agency when purchasing insurance outside of employment. And we were happy to hear that 80% of the respondents said they had a good relationship with their agent and that 82% trust their agent to help them make the right choices.
Survey results: Executive Summary (PDF)