Personal Auto Policy Quiz

Under the physical damage portion of a personal auto policy, coverage for transportation expenses begins how long after the theft of a covered auto?

Coverage for transportation expenses begins 48 hours after the theft of the auto.

Of the following vehicles, which is considered a temporary substitute auto under a personal auto policy?

An auto rented by an insured after the insured's left his car at a garage for repairs Temporary substitute auto means an automobile or trailer, not owned by the insured, temporarily used with the permission of the owner. This vehicle must be used as a substitute for the owned auto or trailer when withdrawn from normal use because of its breakdown, repair, servicing, loss or destruction.

Which of the following coverages are subject to a deductible?

Comprehensive, collision and uninsured motorists coverages have deductibles.

A personal auto policy has split limits of 25/50/25. If a claim for bodily injury damages of $40,000 was made by an injured person and assuming the loss is covered, what is the maximum amount the policy will pay the injured person?

In this example, the liability coverage is provided on a split limits basis of 25/50/25. This means that $25,000 of coverage per person for bodily injury and $50,000 per accident is provided. The most the policy will pay in this situation is $25,000.

While Joe is driving his daughter and her friend to school one morning, he accidentally runs into Jan's car. What part of Joe's Personal Auto Policy would cover Jan's injuries?

Part A Liability is the section that pays to the other party for bodily injury or property damage for which you are legally responsible.

Joe is driving his daughter and her friend to school one morning. Joe accidentally runs into Jan's car. What part of Joe's Personal Auto Policy would cover bodily injury to Joe and his passengers?

Part B

Which of the following losses would be covered under Part A Liability Coverage of a Personal Auto policy?

The policy excludes liability arising out of the use of vehicles designed for use off of public roads, except for non-owned golf carts.

Auto liability limits can be expressed as split limits or a combined single limit. What would be the equivalent combined single limit for split limits of 100/200/100?

To convert to a Single Limit, simply add the limits of total bodily damage ($200,000) to the limits of total property damage ($100,000). The end result is $300,000.

While driving to work one day, Roy was hit by a car that ran a stop sign. Roy's medical bills were $40,000 as a result of the accident. The other driver, who was at fault, carries the state's required limit of $25,000. Roy carries $100,000 of underinsured motorist coverage. How will Roy's medical bills be paid?

Underinsured motorists coverage pays the difference in the insured's actual bodily injury damages and the amount carried by the driver at fault. In this case, the underinsured coverage would pay the difference of $15,000.

Which of the following losses is covered under the Physical Damage coverage of a Personal Auto policy?

Part D of the PAP will cover sound equipment that is permanently installed in the auto

Uninsured Motorists coverage defines an uninsured motor vehicle as all of the following EXCEPT:

Uninsured Motorist coverage defines an uninsured motor vehicle as a vehicle that is not covered for liability insurance or for which the liability limits are less than required by state law. It can also be a hit-and-run driver or a vehicle that was insured at the time of the accident but the insurer becomes insolvent.

What process is used when the insured and the insurance company cannot agree on a claim settlement amount?

The appraisal clause is a provision found in most auto policies that can be invoked either by the insured or the insurer when the insured and the insurer do not agree on the amount of the loss.

Angela has her car insured under a personal auto policy. She borrows her friend's car which is insured by his policy. Angela has an accident while using her friend's car. If a liability claim is filed against Angela and her friend, what will likely occur?

The friend's policy will be treated as primary, while Angela's insurance will be excess. When an insured is driving a non-owned auto, the insured's liability coverage will be treated as excess over any other insurance coverage. In this situation, her friend's insurance would be primary and Angela's insurance would be excess.

Joe's auto was hit by a driver who had liability coverage, but not enough to meet the state's financial responsibility requirement. The driver has liability limits of 10/15/5. Joe's underinsured motorists limits are 100/300/50 and he sustains bodily injury in the amount of $125,000. What total amount will all policies pay?

The other driver's liability would pay $10,000 and Joe's policy would pay $100,000 = $110,000 total.

When physical damage coverage applies, a personal auto policy will pay transportation expenses in the event of loss or damage to a covered auto. The allowance for transportation expenses is:

Under a personal auto policy, the insurer will pay up to $20 a day to a maximum of $600 for transportation expenses incurred in the event of loss or damage to a covered auto.

Joe is driving the family car with his wife, Jane, son Joe Jr. and their daughter, Janie. He has Med Pay limits of $5,000. If Joe and his passengers were injured in an auto accident, what is the maximum that his Personal Auto policy will pay?

With Med Pay, the limits are per person. Since there were four individuals injured at a $5,000 max per person, his company would pay up to $20,000.

When automobile limits of liability are expressed as 15/30/10, this describes what type of coverage?

$15,000 bodily injury for each person, $30,000 bodily injury each accident, $10,000 property damage each accident Split limits are usually expressed as a series of three numbers such as 15/30/10. The first number represents the limit per person for bodily injury, the second number represents the per accident limit for bodily injury, and the last number represents the per accident limit for property damage.

The minimum auto bodily injury liability limits for a particular state are 20/40. Janie is driving with the minimum limits of 20/40. She causes an accident with John in which he suffers bodily injury in the amount of $120,000. John has non-stacked underinsured motorists limits of 100/300. How much will his policy pay toward his injuries?

$80,000 Since John's policy has limits of 100/300, the maximum that will be paid for his injuries between all policies involved is limited to $100,000. Janie's policy offers $20,000 coverage per person (20/40); therefore, John's policy would pay $80,000.

Which one of these statements regarding the personal auto policy is NOT correct? 1)A trailer that the insured borrows from a neighbor while his trailer is being repaired would not be covered. 2) The Medical Payments Coverage will pay for covered medical expenses within 3 years of the accident. 3)Liability coverage is provided using split limits. 4)Autos used in a farming or ranching business are eligible.

Any trailer not owned by the insured that is being used as a temporary substitute while a covered trailer is being repaired would be covered.

Joe drives Janette's car. Both Joe and Janette have a personal auto policy. Which of the following statements is CORRECT concerning coverage if Joe causes an accident?

Janette's policy would be the primary policy since Joe is driving her car with permission. Joe's policy would serve as excess in this case.

While Joe is driving to the grocery store, a dog runs across the street. Joe swerves to avoid the dog but hits the car in the lane next to him. He also hit and knocked down the street sign at the intersection. Joe has the state minimum liability coverage which is 10/15/25 and is at fault. What will Joe's insurance cover if the driver of the other car has $5,000 Bodily Injury and $1,000 Property Damage coverage and the street sign has $500 worth of damage?

Joe's insurance will pay up to $5,000 bodily injury to the other driver, up to $1,000 property damage to the other driver, and up to $500 worth of damage to the street sign. Liability coverage does not pay for damages to the insured.

Which of the following automobile coverages would reimburse the insured without regard to fault, regardless of whether or not the state is subject to no-fault laws?

Medical Payments coverage will reimburse the insured without regard to fault, regardless of whether or not the state is subject to no-fault laws.

If an insured is required to attend a hearing or trial related to a covered accident, the personal auto policy provides supplementary payments for loss of earnings of:

Under the supplementary payments, the personal auto policy will pay up to $200 a day for loss of earnings due to attendance at hearings or trials.

Under a personal auto policy, which of the following is NOT a collision loss?

Impact between the covered auto and a deer The policy states that losses caused by impact with a bird or animal are not collision losses. This would be considered an Other-Than-Collison loss.

Sam runs a stop sign, hitting a car driven by Joe. Joe sustains injuries that cost $20,000 in medical bills while his passengers have medical bills of $15,000. Joe sustained damage to his car in the amount of $9,000. Sam's liability limits are 25/50/25. Ignoring any deductible, what is the total amount Sam's insurance company will pay for this accident?

Remember, the limits of 25/50/25 are as follows: $25,000 maximum payment of any one individual's injuries, $50,000 maximum payment for everyone's injuries, and $50,000 maximum payment for property damage. Joe has bodily injury of $20,000, his passengers have bodily injuries totaling $15,000, Joe's car has $9,000 of damage. The individual BI limit will pay $20K for Joe's BI and $15K for the passengers' BI which totals $35K. The the property damage will pay $9K toward Joe's car. $35,000 + $9,000 = $44,000.

Under a personal auto policy, all of the following would be an insured for liability coverage EXCEPT:

The insured's employees are not considered insureds for liability coverage under a personal auto policy.

Liability coverage is only provided for damages resulting from unintentional, accidental causes. Also, coverage is not extended to equipment which is rented by the insured.

would be covered under the personal auto policy liability coverage?