Auto Insurance (25%)
Private passenger vehicle
an automobile used for private needs rather than for business uses
Coverage for medical payments under a Personal Auto Policy applies to expenses following a covered accident that are incurred and services rendered within what time period?
3 years
Bailee
someone who is entrusted with possession of another person's property but has no ownership of it
If an auto policy has split limits of 30/50/25, how much will the policy pay for property damage in a single accident?
$25,000
If an auto policy has split limits of 30/50/25, how much will the policy pay for property damage in a single accident?
$30,000
If an auto policy has liability limits of 40/60/20, what would be the equivalent combined single limit?
$80,000 - combined total of coverage for bodily injury and property damage
Split limit
- Bodily injury for each person involved; - Bodily injury for the entire accident (regardless of the total number of persons involved); and - Property damage. Note: split limits are always expressed in this order. For example, policy limits expressed as 25/50/25 would provide $25,000 coverage for bodily injury per person, with a maximum of $50,000 for all bodily injuries, and $25,000 property damage coverage per accident.
PA: Who is Insured?
- Insured or any family member for the ownership, maintenance, or use of any auto or trailer; - Any person using an insured's covered auto with permission; - For an insured's covered auto, any person, or organization (this is only with respect to legal responsibility for acts or omissions of a person for whom coverage is afforded under liability); and - For any auto or trailer other than the insured's covered auto, any other person, or organization, but only with respect to legal responsibility for acts or omissions of the insured or a family member for whom coverage is afforded under liability. This provision applies if the person or organization does not own or hire the auto or trailer.
Other-than-collision (previously called comprehensive) includes losses caused by the following:
- Missiles or falling objects; - Fire; - Theft or larceny; - Explosion or earthquake; - Windstorm; - Hail, water, or flood; - Vandalism or malicious mischief; - Riot or civil commotion; - Contact with birds or animals; and - Breakage of glass.
PC: UM DOES NOT INCLUDE
- Owned or available for regular use by the insured or a family member; - Owned by a self-insurer unless the self-insurer becomes insolvent; - Owned by a government agency; - Operated on rails or crawler treads; - Designed mainly for use off public roads (and while not on public roads); or - While used as a residence or premises.
uninsured motorist
- Someone driving a car with no auto liability insurance; - Someone with an auto liability policy issued by an insurer who has become insolvent; - An unidentified hit-and-run driver; or - Someone with an auto liability policy with limits lower than those required by law. Uninsured motorist bodily injury coverage pays for medical expenses, lost wages, and other general damages when the insured or his or her passengers are injured in an accident caused by an uninsured motorist. The limits for uninsured motorist coverage are set at the purchase of the auto policy. In Uninsured Motorist coverage, the minimum limits for bodily injury are $25,000/$50,000. Uninsured motorist property damage coverage protects against damage to the insured or the covered auto when in an accident caused by an uninsured motorist. The limits for uninsured motorist coverage are set at the purchase of the auto policy. Some states require a deductible each time an auto insurance claim is filed.
Liability, medical payments and uninsured motorist coverage will be extended to a newly acquired auto for replacement vehicles as follows:
- The coverage will be the broadest offered on any existing vehicle on the declarations and there is no stipulation that the insurer be notified; and - If the vehicle is in addition to the listed vehicles the policy will grant coverage but only if the insurer is notified within 14 days of the insured becoming the owner.
Collision Coverage and/or Other Than Collision Coverage for a newly acquired auto begins on the date the insured becomes the owner:
- The insured must ask the company to insure the vehicle within 14 days of becoming the owner if the Declarations section indicates that Collision and/or Other Than Collision Coverage applies to at least one auto. - In this case, the newly acquired auto will have the broadest coverage now provided for any auto shown in the Declarations. - If no such indication is made and the insured incurs a loss within the first 4 days of ownership, coverage may still be requested (within the first 4 days), and a $500 deductible will apply.
PB: Who is Insured?
- The named insured ("you") or any family member while occupying a motor vehicle designed for public road use, or any trailer; - The named insured or family member as a pedestrian if struck by a motor vehicle designed for public road use, or any trailer; and - Any other person while occupying a covered auto.
"You" and "your"
- The named insured shown in the Declarations; and - The spouse of the named insured, if a resident of the same household. If the spouse ceases to be a resident of the same household during the policy period or prior to the inception of the policy, the spouse will only be considered under the definition of you and your until the earlier of : • The end of 90 days following the spouse's change of residency; • The effective date of another policy listing the spouse as a named insured; or • The end of the policy period.
PB: Exclusions
- While occupying any of the following vehicles: • With fewer than 4 wheels; • Used as a public livery, including being logged into a transportation network platform (this exclusion does not apply to a share-the-expense carpool or while the covered auto is being used for volunteer or charitable purposes); • Used as a residence or premises; • Used without permission; • A commercial type vehicle when it is being used for business of an insured; or • Located inside a facility designed for racing, and for the purpose of competing in or preparing for any prearranged or organized racing or speed contest. - While occupying, or when struck by, any vehicle (other than the covered auto) that is owned or regularly furnished for use by • The insured; or • Insured's family member; - In the course of employment if workers compensation benefits are required; and - While occupying a vehicle located inside a racing facility when used for the purpose of competition or practicing for a prearranged or organized speed contest.
DOES COVER
- carpools - small pickup trucks (farming and ranching) - insured & passangers
Miscellaneous Type Vehicle (Selected Endorsement)
- endorsement is used to expand the definition of a covered auto to include motorized vehicles such as motorcycles, motor homes, golf carts, dune buggies, and other recreational vehicles. - The liability and medical payments exclusions regarding vehicles with less than 4 wheels do not apply when this endorsement is attached to the policy. - Coverage is not provided for vehicles borrowed or rented unless a temporary substitute to a miscellaneous vehicle listed in the endorsement.
Covered auto INCLUDES:
-Any vehicle shown in the declarations; - A newly acquired auto; - Any trailer owned; or - Any auto or trailer not owned by the insured but used as a temporary substitute for a vehicle described above which is out of normal use because of its breakdown, repair, servicing, loss or destruction.
What types of losses are indicated by the split limits in an auto insurance policy?
-Bodily injury per person, -bodily injury per accident, and -property damage per accident
PAP
-On a PAP, an at-fault driver's injuries would be covered by medical. -Supplementary payments under a PAP do not cover the insured's loss of earnings except when the insured is attending a hearing or trial at the insurer's request. The insured's injuries are not covered. -Auto medical on a PAP protects the insured and passengers in the car. It is an optional coverage. It is not a supplementary payment, and it is no-fault. -Coverage D on a PAP is called coverage for damage to an insured's car and is optional. It is divided into collision and other than collision. -In an accident, the owner's PAP is always the primary policy; the driver's PAP, if different, is always the excess policy.
DOES NOT COVER
-coverage in Mexico -insured's property in transit -injured pedestrian -motorcycles, dump trucks, or farm implements driven on highways - wear & tear, freezing & mechanical breakdown - auto used as taxis or livery
What are the 4 categories of uninsured motor vehicles?
1) No insurance or liability bond; 2) Insurance is less than what's required by the financial responsibility laws; 3) A hit-and-run accident where the driver cannot be identified; and 4) The insurer denies coverage or becomes insolvent.
The ownership or operation of an auto involves three types of potential loss, and PAP must provide protection for these losses under diverse circumstances:
1. Legal liability (for injuries and/or property damage to others); 2. Injury to the insured or members of the insured's family; and 3. Damage to or loss of the auto itself.
Cancellation and Nonrenewal
A cancellation occurs whenever an insurer, directly or indirectly, terminates an automobile insurance contract or policy prior to its expiration date. If a contract has a period of less than 12 months or no fixed expiration date, it is considered written for successive periods of 12 months. Any attempt by the insurer to terminate the contract or policy on a date other than its anniversary date is a cancellation.
What would be considered a newly acquired auto?
A vehicle acquired by the insured during the policy period
What is a covered auto?
A vehicle shown in the policy declarations
Required Limits of Liability
All auto liability policies issued in South Carolina must be written with the following minimum limits of liability: $25,000 for bodily injury or death to 1 person in a single accident; $50,000 for bodily injury or death to 2 or more persons in a single accident; and $25,000 for damage to property from a single accident. Insurers who issue, sell, or deliver auto policies in this state may raise limits beyond the minimum requirement.
Nonrenewal
An insurer cannot refuse to renew an automobile insurance policy for any of the following reasons: Age; Sex; Location of residence; Race; Color; Creed; National origin; Ancestry; Marital status; Income level; Lawful occupation; Lack of driving experience; Lack of supporting business; One or more accidents or traffic violations, occurring more than 36 months preceding the policy's anniversary date; One or more claims submitted under comprehensive or towing charges; No more than 2 accidents within a 3-year period (unless the accident was caused by the insured or another driver of that same vehicle); or An insured who uses their personal automobile for volunteer emergency services, and who provides a copy of the insurance policy promulgated by the chief of their department.
An insurer
An insurer who has a pattern of unfair discrimination may face a fine of up to $200,000. An insurer must maintain records of all cancellations and nonrenewals for at least 3 years.
In personal auto policy, to what geographical region does the out-of-state coverage apply?
Any U.S. state or territory, as well as Canada
What coverages are available in the physical damage section of the personal auto policy?
Collision and other-than-collision coverages
Collision
Coverage D is written on an ACV basis and has a deductible. Collision coverage on the PAP covers colliding with another object, rollover and upset. Everything else is covered by other than collision coverage. Hitting a pole with an insured automobile would be an example of a collision.
Part D: Coverage for Damage to Your Auto
Coverage for Damage to Your Auto, commonly called physical damage coverage, includes both collision and other than collision coverage (previously referred to as comprehensive). Only when a premium is shown on the Declarations next to these coverages does coverage apply. The insuring agreement states that the insurer will pay for direct and accidental loss to a covered or nonowned auto, including equipment, minus any applicable deductible shown on the Declarations. If loss to more than one covered auto or nonowned auto results from the same collision, only the highest applicable deductible will apply.
Part E: Duties After an Accident or Loss
Duties after an Accident or Loss outlines the duties required of any person seeking damages under the policy following a loss or accident. This PAP coverage part does not include any subsections. If the insured fails to comply with this section of the policy, resulting in harm to the insurer, the insurer is relieved of its duty to provide coverage. These duties are similar to those already discussed for other types of insurance, and include - Prompt notification of loss; - Cooperating with the insurer; - Forwarding any legal papers received; - Submitting to a physical exam, examination under oath when requested, and recorded statements; - Allowing the insurer access to medical records; - Submitting a proof of loss; Notifying the police of a hit-and-run accident or if a vehicle is stolen; - Protecting the property from further loss; and - Allowing the insurer to inspect and appraise the damaged property.
Part F: General Provisions
General Provisions in the personal auto policy form describes the conditions that apply to all coverage parts in addition to the conditions that apply to the individual coverages. These conditions, which are similar to some already discussed, are as follows: Bankruptcy — Bankruptcy of the insured does not relieve the insurer of its obligations under the policy. Policy changes — The terms and conditions may not be changed or waived except by endorsement to the policy issued by the insurance company. Fraud — The insurer will not provide coverage for any insured that has made a fraudulent statement or engaged in fraudulent conduct as it pertains to any loss or accident. Legal action against the insurer — No one may bring any legal action against the insurer until all policy provisions have been complied with. Insurer right to recover payment (subrogation) — Subrogation rights apply to all coverages except physical damage coverage if the damage is caused by a person using the auto with a reasonable belief that they were entitled to do so. Policy period and territory — The policy territory is defined as the United States, its territories and possessions, Puerto Rico, or Canada. Termination — This provision specifies the rights and duties of the insured and insurer to cancel or nonrenew coverage. If a law in the state the policy was issued in requires a different period for notice or any special procedures other than those listed below, the policy will comply with the state provisions. In most states*, the insurer is required to provide 10 days' notice if for nonpayment of premium or if the policy is canceled within the first 60 days of initial coverage, and 20 days' notice for all other reasons. If the policy has been in force for more than 60 days, the insurer can only cancel because of nonpayment of premium, if an insured driver's license has been suspended or revoked, or if the policy was obtained through material misrepresentation. If the insurer decides to nonrenew coverage, the insurer must provide at least 20 days' notice before the renewal date. If the insured obtains other insurance on a covered auto, the policy will terminate on the effective date of the new policy. Transfer of insured's interest in the policy (assignment) — The insured cannot transfer his or her rights or interest in the policy without the written consent of the insurer. If the named insured dies, coverage will be provided for the surviving spouse or legal representative of the insured, but only until the end of the policy period. Two or more auto policies — If the insurer has issued 2 or more policies that will respond to the same loss, the insurer's liability will be the highest applicable limit of insurance under one policy.
PA: Out of State Coverage
If a covered auto is involved in an auto accident that occurs in any state or Canadian province other than the one in which the auto is principally garaged, the out-of-state coverage will apply, and the insurer will interpret the policy for that accident as follows: - If the state or province has a financial responsibility law specifying limits of liability higher than the limits shown in the Declarations, the insured's policy will provide the higher specified limits; or - If the state or province has a compulsory insurance requiring a nonresident to maintain insurance whenever the vehicle is used in that state, the insured's policy will provide at least the required minimum amounts and types of coverage. Each state establishes the minimum liability limits for its policies; therefore, the limits do not change when a vehicle travels from state to state, and remain the same regardless of the state the vehicle is in However, in the event the insured is in an accident, in order to be insured at the required minimum limits for the state the accident occurs in, the limits adjust to the minimum limits for that state, and where necessary, add other coverage.
Amendment of Policy Provisions - South Carolina (Selected Endorsements)
If an auto policy has been in effect for less than 90 days, the insurer can cancel for any legal reason. If an auto policy has been in effect for more than 90 days, the insurer cannot cancel except for nonpayment of premium or if the insured or anyone in the household who normally operates the automobile has had their driver's license suspended or revoked. In South Carolina, cars, not drivers, are insured. If the policy is cancelled for nonpayment, the insurer must give the insured 15 days' written notice. If an insurer intends to cancel or nonrenew an auto policy for any other reason, the insurer must give the insured 15 days' written notice on a form approved by the DOI stating the reason and informing the insured of their right to appeal the company's decision to the DOI within 15 days of the receipt of the notice. By law in South Carolina, Other Than Collision (OTC) deductibles do not apply to safety glass.
Underinsured Motorist Coverage
If an individual is concerned about being in an auto accident with someone who has inadequate limits of liability and who is at-fault, they would purchase underinsured motorist coverage.
Days of Written Notice
If an insurer cancels or nonrenews an automobile insurance policy for reasons other than nonpayment of premium, the first named insured must be given 15 days' prior written notice. the insurer cancels an automobile insurance policy for nonpayment, the first named insured must be given 10 days prior written notice. Furthermore, within 90 days of the initial notice, the insured may request the specific reasons for cancellation in writing. Subsequently, the insurer must provide such information within 21 business days.
Uninsured motorists
Included in the definition of an uninsured motorist is a hit-and-run driver, one whose insurer has gone bankrupt, and one who does not carry the state minimum limits.
Uninsured motorist coverage
Insureds purchase uninsured motorist coverage because of their concern of being in an auto accident with someone who has no insurance and is at-fault.
What losses are excluded from coverage in the liability section of the Personal Auto Policy?
Intentional injury or damage, damage to property owned or transported by the insured, use of a vehicle as a public conveyance, or use of a vehicle without permission.
Other than collision
Is open peril coverage for damage to your car and includes things such as, Theft, Contact with Bird or Animal and Glass Breakage. Hitting a deer is an example of other than collision. If a bird were to hit the insured's windshield, the windshield is covered under other than collision on a PAP.
Liability
Liability covers BI and PD to others for which an insured is proven to be negligent.
What Personal Auto coverage would pay for damages to a covered auto caused by a collision with a deer?
Other Than Collision (Comprehensive)
comprehensive coverage
Other than collision coverage is also known as comprehensive coverage.
What Personal Auto coverage would pay for the insured's travel expenses and loss of earnings while the insured is involved in the settlement process of a covered loss?
Part A: Liability
If an insured is injured while driving his own car, what coverage in his personal auto policy will pay for the loss?
Part B: Medical Payments
PD: Other Provisions
Payment of Loss — The insurer has the option of paying money, repairing or replacing the damaged or stolen property. In addition, if stolen property is recovered, the insurer may return the property to the insured, paying for any damage, or they may keep all or part of the property at an agreed or appraised amount. No Benefit to Bailee — The insurance will not directly or indirectly benefit any carrier or bailee for hire (For example, if an insured's vehicle is in the care of a service station for repairs, and the vehicle is damaged while in their care, the service station will not receive any benefits from the insurance policy on the vehicle.) This provision is intended to provide insurance compensation to the victim of the loss (the insured), rather than paying it to the bailee. Other Sources of Recovery — If other insurance is applicable, the insurer will pay on a proportional basis. Coverage for any covered nonowned auto is excess of any other collectible source which includes insurance and any other source of recovery available to the owner of the nonowned auto. Appraisal — If the insured and the insurer cannot agree on a settlement, either party can demand appraisal. Each party will then select and pay for its own appraiser. The appraiser, in turn, will jointly select a third appraiser, called an umpire. The decision reached by at least 2 of the appraisers will be binding on both parties.
Uninsured and Underinsured Motorist
South Carolina law requires those with auto liability insurance to also have Uninsured Motorist coverage. This coverage provides a form of personal injury protection, and also requires a $200 deductible for any property damage done by the at-fault uninsured motorist. South Carolina auto insurers are required to offer both Uninsured and Underinsured Motorist coverage to all their policyholders with limits up to the insured's liability limits. If the offers are not rejected in writing, both coverages are added at the full offered amount and the customer will be billed. The customer may reject the offer of Underinsured Motorist coverage entirely, because by law, it is an optional coverage in South Carolina. However, the customer must have at least 25/50/25 for Uninsured Motorist, because this coverage is required by law in South Carolina.
South Carolina Motor Vehicle Financial Responsibility Act
South Carolina's Financial Responsibility Law requires that before drivers operate motor vehicles on the public highways of this state, they must show they are financially able to pay for bodily injury or property damage they may cause others while operating the vehicle.
Supplementary Payments
Supplementary payments under a PAP do not cover the insured's loss of earnings except when the insured is attending a hearing or trial at the insurer's request. The insured's injuries are not covered.
Auto Assigned Risk Plan
The Auto Assigned Risk Plan provides a method for those who have been rejected in the normal market to obtain coverage. All authorized insurers selling auto insurance must participate in the Auto Assigned Risk Plan.
PB: Limits of Liability and Other Insurance
The amount of coverage depends on the policy and applies on a per-person basis for bodily injury sustained in an accident covered by the policy, regardless of fault. For example, the insured's policy has a medical payment coverage limit of $10,000. The insured and the passenger were injured in an accident; one person had $12,000 in injuries, and the other $10,000. Part B will pay each person $10,000, up to the limit of coverage.
PD: Exclusions
The exclusions listed below apply for losses or damages to or caused by any of the following: While a covered vehicle is being used as a public livery, excluding carpools; Wear and tear, freezing, mechanical or electrical breakdown, and road damage to tires (does not apply if the damage resulting from the total theft of a covered vehicle); Radioactive contamination, nuclear weapons, war, insurrection, rebellion or revolution; Electronic equipment designed for reproduction of sound, including radios, stereos, tape decks, and compact disk players and accessories (does not include permanently installed equipment and its accessories); Any other electronic equipment that receives or transmits audio, visual or data signals, including citizen band radios, telephones, two-way mobile radios, scanning monitor receivers, television monitor receivers, video cassette recorders, audio cassette recorders, and personal computers and accessories (does not include equipment which is permanently installed in the dash or console of the vehicle); A total loss due to confiscation or destruction by governmental or civil authorities; A camper body, trailer, or motor home not shown in the declarations (does not apply to newly acquired camper bodies or trailers acquired during the policy period or insured by request within 14 days of ownership); this exclusion also applies to facilities or equipment used with the above types of vehicles; Awnings, cabanas, or equipment designed to create additional living space; Nonowned vehicles used without a reasonable belief that any insured is entitled to do so; Radar detection equipment; Any custom furnishings or equipment in any pickup or van exceeding coverage of $1,500, including special carpeting and insulation, furniture, bars, facilities for cooking or sleeping, height extending roofs, enhancers, winches, grilles, louvers, side pipes, hood scoops or spoilers, wheels, tires, spinners, caps, covers, bedliners, custom murals, paintings, or other decals; Any nonowned auto being maintained or used by any person while engaged in the business of selling, repairing, storing, servicing, or parking vehicles; Any covered auto located in a racing facility for the purpose of competing, practicing, or preparing for any organized racing or speed contest; and Any nonowned auto rented by any insured if the rental company is prevented from recovering loss or loss of use from the insured because of the rental agreement or state law; Any nonowned auto being used by any insured in connection with a personal vehicle sharing program if a provision of the program or state law prevents the recovery of loss or loss of use from the insured; and Any loss to a vehicle which is designed or can be used for flight.
Extended Nonowned Coverage for Named Individual (Selected Endorsements)
The extended nonowned coverage for named individual endorsement can broaden the liability only, or liability and medical payments coverage provided in the policy for individuals specifically named on the endorsement. It provides coverage for nonowned autos that are available for the regular use of the insured, the use of covered vehicles to carry persons or property for a fee, or use of covered vehicles in other businesses (excluding the automobile business).
PA: Exclusions
The following exclusions apply to the liability coverage provided for certain persons and vehicles in the PAP: - Intentional injury or damage; - Damage to property owned or being transported by a covered person; - Damage to property rented, used, or in the care of a covered person, except a home or private garage; - Bodily injury to an employee during the course of employment, except domestic employees not required to be covered by workers compensation; - Use of a vehicle as a public or livery conveyance, except carpools; - Use of a vehicle by an insurer who is logged into a transportation network platform as a driver, whether or not a passenger is occupying the vehicle; - Damage caused by any person while engaged in the business of selling, repairing, servicing, storing, or parking vehicles designed for use mainly on public highways (note that this exclusion does not apply to the ownership, maintenance or use of your covered auto by the insured, any family member, or any partner, agent or employee of the insured or any family member); - Use of commercial-type vehicles in any business; - Persons using a covered auto without permission; Persons insured under a nuclear energy policy, including persons that would have been insured except for the exhaustion of the policy limits; - The ownership, maintenance, or use of: • Any motorized vehicle with fewer than 4 wheels; • Any vehicle designed mainly for use off public roads; • Any other vehicle owned or available for regular use by the insured, other than a covered auto; • Any vehicle owned by or furnished for regular use by a family member, other than a covered auto; the named insured is covered while maintaining or occupying such a vehicle; • Any vehicle located inside a racing facility for the purpose of racing; and Used or designed for flight.
Underinsured Motorist (UIM) coverage will pay the difference between which 2 limits?
The insured's UIM limits and the at-fault driver's insurance bodily injury limits
When does the Underinsured Motorist coverage apply?
When the motorist is at fault in an accident, but the limits of his/her auto insurance are not sufficient to cover the bodily injury to another motorist
Cancellation
The insurer may cancel an automobile policy for any reason within the first 90 days. After this initial 90-day period, the policy may only be cancelled for the following reasons: The named insured (or another person that regularly drives the same vehicle) has his or her license suspended or revoked during the policy period - or within a 90-day period preceding the last anniversary date (if the policy is a renewal); The named insured fails to pay the premium; The named insured violates any of the terms or conditions of the policy; or Insurance was obtained through fraudulent misrepresentation.
What is the limit of liability in Part D: Coverage for Damage to Your Auto?
The lesser of the actual cash value of the vehicle or the amount needed to repair or replace the vehicle
PA: Other Insurance
The liability section also includes the other insurance clause, which states that if there is other insurance available to pay for a covered loss, the insurer will only pay its share of the loss. For nonowned vehicles, the insurance will be considered excess over any other collectible insurance.
PD: Limits of Liability
The limit of liability is the lesser of - The actual cash value of the vehicle at the time of the loss (which includes an adjustment for depreciation and physical condition); or - The amount necessary to repair or replace the vehicle. Losses to nonowned autos will be covered the same as the broadest coverage available for any covered auto, except nonowned trailers are limited to $1,500. Electronic equipment that is permanently installed in a location not normally used by the auto manufacturer is covered up to $1,000.
What is the combined limit in an auto insurance policy?
The maximum amount the insurer will pay on a covered loss
Medical Payments
The medical payment section of the personal automobile policy pays necessary medical and funeral expenses caused by an accident and sustained by an insured. The medical payments coverage found in the personal automobile policy will not pay for lost wages.
What does the term "you" refer to in a personal auto policy?
The named insured shown in the declarations, and the insureds spouse (if resident of the same household).
permanently installed
The personal auto coverage form will provide coverage for radios and tape decks if they are permanently installed in the dash.
Personal Auto Policy (PAP)
The personal auto policy (PAP) is an insurance policy for the owners of private passenger vehicles. The policy combines physical damage insurance on the automobile with liability insurance for claims from use of the auto. The PAP contains several parts, each describing specific coverage as follows: Part A - Liability Coverage; Part B - Medical Payments Coverage; Part C - Uninsured Motorist Coverage; Part D - Coverage for Damage to Your Auto; Part E - Duties After an Accident or Loss; and Part F - General Provisions.
When does Uninsured Motorist coverage apply?
When the other party is legally liable but has no insurance
Towing and Labor Costs (Selected Endorsement)
The towing and labor costs endorsement provides a basic limit of $25 for towing and labor costs incurred at the place a vehicle is disabled. Higher limits are available for an additional premium. Coverage applies to a covered auto or a nonowned auto, but only applies to costs incurred at the place of disablement.
What is considered insured under Part A: liability of a personal liability?
The vehicle owner, his/her family, or any using covered auto with permission
Towing and labor
Towing and labor is an optional coverage on the PAP and costs extra. The optional coverage limit for towing and labor pays on a per event/occurrence basis.
PD: Transportation Expenses
Transportation expenses will be paid if the loss is caused by collision or other-than-collision, as long as the corresponding coverage is indicated in the Declarations. The policy will usually pay up to $20 per day up to a maximum of $600 (may vary by state) for transportation expenses incurred by the insured due to a covered loss. Expense payments begin after a 24-hour waiting period for reasons other than theft. In the event of theft of a covered vehicle, expenses are covered beginning 48 hours after the theft.
PA: Limits or Liability
Under a personal auto policy, the insured may choose between 2 types of liability limits: split and combined single. Split limit coverage uses 3 dollar amounts. combined single coverage uses one dollar amount, indicating the maximum coverage for all losses - regardless of the number of people involved or the amount of property damaged.
PA: Supplementary Payments
Under the supplementary payments provision, the insurer promises to pay certain other costs on behalf of an insured: - Up to $250 for the cost of bail bonds required of the insured because of a covered loss; - Premiums on appeal bonds and bonds to release attachments in suits covered under the policy; - Interest on a judgment after the judgment has been entered; and - Up to $200 per day for loss of earnings for assisting in legal proceedings (e.g., attendance at hearings or trials); and - Other reasonable expenses incurred at the request of the insurer. Amounts payable under the supplementary payments provision are payable in addition to the liability limit.
South Carolina is an excess state.
Underinsured motorist coverage will act as excess over the at-fault motorist's bodily injury and property damage coverage. Underinsured motorist coverage is optional for the insured in this state.
PC: Underinsured Motorist
Underinsured motorists (UIM) coverage helps an insured with bodily injury damage caused by another motorist when that motorist has insufficient coverage. UIM coverage will pay the difference between the insured's UIM limits and the at-fault driver's bodily injury limits. Insured's UIM limits - Driver's BI limits = Amount paid by UIM coverage For example, Bob has bodily injury limits of 25/50. Bob causes a car accident in which Zoe is injured. Zoe's bodily injury damages come to $65,000. Bob's bodily injury coverage will only pay for $25,000 of Zoe's damages, leaving her with $40,000 to pay. Here are 2 ways underinsured motorists coverage could respond, depending on Zoe's limits: 1. If Zoe's underinsured motorist limits are 100/150, her UIM coverage will pay the remaining $40,000 of BI damages. 2. If Zoe's limits are 50/100, her UIM coverage will only pay another $25,000 of the $40,000 in BI damages. The remaining $15,000 would not be covered by insurance. $50,000 (Zoe's UIM limit) - $25,000 (Bob's per person limit) = $25,000 (what the UIM will pay)
What type of auto will apply in a hit-and-run where the driver cannot be identified?
Uninsured Motorists
Part C: Uninsured Motorists
Uninsured motorist (UM) coverage provides the insured with money for bodily injuries that the insured would be legally entitled to recover from the owner or operator of a vehicle that does not carry the required liability insurance coverage. A vehicle that does not carry the required insurance is defined in this section of the PAP as an uninsured vehicle. 1. There is no liability bond or insurance for the vehicle; 2. The bond or insurance is less than that required by the financial responsibility laws of the state in which the accident occurred; 3. The accident was a hit-and-run accident, and the driver cannot be identified; and 4. The bonding company or insurance company denies coverage or is insolvent.
Lessor
a person granting a lease of a motor vehicle
family member
a person related by blood, marriage, or adoption who is a resident of the household. This includes ward or foster children.
appraisal
a professional assessment to determine extent of damage
Property Damage
means physical injury, destruction or loss of use of tangible property.
Newly Acquired Auto
any of the following types of vehicles that are acquired by the insured during the policy period: - A private passenger auto; - A pickup or van, for which no other insurance policy provides coverage, that: • Has a gross vehicle weight of less than 10,000 lbs. (GVW is the maximum recommended weight including the vehicle, fuel and fluids, passengers, and all cargo); • Is not used for the delivery or transportation of goods and materials unless such use is incidental to a business of installing, maintaining, or repairing furnishings or equipment; or • Is not used for farming or ranching.
PD: Nonowned Autos
as any private passenger auto, pickup, van, or trailer which is operated by or in the custody of, but is not owned or furnished for the regular use of the named insured or a family member.
Temporary Substitute
auto or trailer not owned by the insured use while the insured vehicle is out of service because of breakdown, repair, loss or destruction
PB: Other Insurance
clause also is shown in the medical payments section of the policy that is identical to the provision found in the liability coverage section.
Part B - Medical Payments
covers all reasonable medical and funeral expenses incurred by an insured in an accident Medical payments coverage pays reasonable expenses associated with necessary medical and funeral expenses caused by an accident and sustained by an insured. Expenses and services must be rendered within 3 years of the accident.
Part A: Liability Coverage
covers damages for bodily injury or property damage that an insured becomes legally responsible for because of an auto accident
PC: Who is insured?
defined under Part C: Uninsured/Underinsured Motorist as - The named insured and family members; - Any other person while occupying a covered vehicle; and - Any person entitled to recover damages because of injuries to one of the above.
underinsured motorist
is one with auto liability coverage at least with legally required minimums, but too low to pay for all the damage done to another. Once the at-fault driver's limits have been reached, the harmed party's underinsured motorist would begin to pay. Underinsured motorist bodily injury coverage pays for medical expenses, lost wages, and other damages when the insured or his or her passengers are injured in an accident caused by a driver with insufficient auto insurance coverage. This bodily injury coverage usually pays the difference between the insured's underinsured motorist bodily injury limit and the other driver's bodily injury coverage limit. The limits for underinsured motorist coverage are set at the purchase of the auto policy. Underinsured motorist coverage protects against damage to the insured or the covered auto when in an accident caused by a driver with insufficient auto insurance coverage. This property damage coverage usually pays the difference between the insured's underinsured motorist property damage limit and the other driver's property damage coverage limit. The limits for underinsured motorist coverage are set at the purchase of the auto policy.
Collision
is the upset or impact of a covered vehicle or nonowned auto with another vehicle or object.
Hired
lease, rented, or borrowed
Trailer
means a vehicle designed to be pulled by a private passenger auto, pickup or van, or farm wagons and implements while towed by any of the above vehicle types.
Bodily Injury
means bodily harm, sickness or disease, including death that results from the injury.
Occupying
means in, upon, getting in, on, out of, or off a vehicle.
Insurance contracts or policies issued to meet the state's financial responsibility requirements
must be issued for a period of not less than 6 months. These policies may be cancelled within the first 60 days for any of the following reasons: A premium payment is returned unpaid or for insufficient funds; The insured sold or disposed of the insured vehicle; The insured surrendered his or her tags and registration; or The insured fails to pay the premium (in these cases the policy must remain in effect for 30 days).
Non owned
private vehicles operated by or in customer of the named insured, not titled to the insured
financial responsibility
proof that one can pay for damages caused, often fulfilled by purchasing insurance
Livery
transporting of people or things for hire (e.g., taxi service)
Owned
vehicle titled to the insured or acquired during policy period
Mutually exclusive
when something cannot occur simultaneously with something else
Know that any person qualifies as an insured
while using a covered auto, as defined in Part A - Liability Coverage section of a personal auto policy.
PA: Insuring Agreement
• Bodily injury and property damage due to an accident for which the insured is legally responsible; • Defense costs as long as the policy covers a particular loss (these costs are paid in addition to the policy limits); and • Costs for settling or defending the insured as deemed appropriate (these costs end when the limits of insurance are exhausted).
