Hawaii Insurance Adjuster License Practice Exam

What type of insurance primarily covers risks associated with theft?

1. Property Insurance

2. Liability Insurance

3. Comprehensive Insurance

4. Workers' Compensation Insurance

The correct answer is: Property Insurance

Property insurance is specifically designed to cover risks associated with the loss or damage to physical assets, including coverage for theft. This type of insurance provides financial protection for a policyholder’s property—such as homes, businesses, and personal belongings—against risks that can result in direct loss. When theft occurs, property insurance can help to reimburse the insured for their losses, allowing them to recover their financial investment in their possessions. The other types of insurance listed do not primarily focus on theft. Liability insurance usually covers injuries or damages that the insured may be legally responsible for, rather than direct property loss. Comprehensive insurance typically refers to coverage that protects against a broader range of risks but is mainly used in the context of auto insurance where it covers damages to a vehicle from a variety of incidents, including theft, but does not focus on property loss as a primary feature. Workers’ compensation insurance provides benefits to employees who are injured on the job and does not cover risks associated specifically with theft. Therefore, property insurance is the most relevant coverage for addressing risks related to theft.