INS 22 Assignment 4: PAP: Physical Damage, Duties After an Accident, Endorsements

Cancellation

termination of a policy; by either the inusrer or the insured; during the policy term

only a person who is named in the endorsement

the Names Non-Oner coverage endorsement of the PAP automatically covers

Policy termination

the ending of the contractual relationship between the insured and insurer by cancellation, expiration, or nonrenewal

additional liability insurance as well as providing physical damage coverage

the major advantage of the Limited Mexico Coverage endorsement to the PAP is that it provides

1. comprehensive-pays for loss to covered auto or its equipment from any cause not excluded, except collision or overturn 2. specified causes of loss- provides named peril coverage 3. collision-covers loss to a covered auto or its equipment by collision with another object or by overturn 4. towing- provides coverage for towing and labor performed at the place of disablement

4 kinds of physical damage coverages:

the lower of the ACV or the amount necessary to repair or replace the property with other property of like kind and quality

According to Part D- Coverage to Damage to your auto of a personal auto policy, the insurer's limits of liability for a physical damage loss to a covered auto is

this provision states that if the insured declares bankruptcy or becomes insolvent, the insurer is not relieved of any obligations under the policy

Briefly describe each of the general provisions in Part F of the PAP - Bankruptcy of the Insured

to comply with the cancellation provision, Henry can cancel the original policy anytime during the policy period by returning the policy to the insurer or by giving advance written notice of the date the cancellation is to become effective

Briefly describe each of the general provisions in Part F of the PAP -Henry has replaced his current auto insurance policy with a new insurer. What must he do to cancel his original auto policy, which was issued by a different insurer

according to this provision, coverage applies only to accidents and losses that occur during the policy period shown on the dec page. The policy territory includes the US, US territories and possessions, Puerto Rico, and Canada. The policy also applies to a covered auto while being transported among ports of the US, Puerto Rico, or Canada. Coverage doesn't apply anywhere outside the policy territory

Briefly describe each of the general provisions in Part F of the PAP -Policy Period and Territory

according to this provision, if two or more auto policies issued to the named insured by the same insurer apply to the same accident, the insurer's maximum limit of liability is the highest applicable limit of liability under any one policy.

Briefly describe each of the general provisions in Part F of the PAP -Two or More Policies

Applies to damage to a parked insured vehicle resulting from a passenger in another parked vehicle opening its door.

Collision coverage under the Personal Auto Policy (PAP)...

covers the towing of a disabled covered or non owned auto, including costs for labor preformed at the place of disablement

Frequently used personal auto endorsements: towing and labor costs coverage

covers trailers or camper bodies included related facilities or equipment

Frequently used personal auto endorsements:trailer/camper body coverage

-promptly notify the police if a hit-and-run driver is involved -send a copy of the legal papers to the insurance company if the person seeking coverage sues the uninsured motorist

Describe 2 additional duties required if the insured is seeking payment under Coverage C- Uninsured Motorists Coverage of the PAP

the notification should include details such as how, when, and where the accident happened, as well as the names and addresses of any injured persons and witnesses

Describe the details a person seeking coverage under the PAP should include when notifying the insurer that an accident or a loss has occurred

no legal action can be brought against the insurer until the insured has fully complied with all of the policy terms. In addition, under Part A- Liability coverage, no legal action can be brought against the insurer unless the insurer agrees in writing that the insured has an obligation to pay damages or the amount of the insurer;s obligation has been finally determined by a judgment after a trial

Describe the obligations that an insured must fulfill before he or she can sue the insurer

John can collect either from the other driver or from his own insurer. If John collects from his insurer, that insurer has the right to recover payment from the driver. This recovery is referred to as subrogation

Explain John's options for collecting damages if he has collision coverage for his car and another driver causes an accident that damages John's car

The vehicle would be covered if driven occasionally by the insured. However, if the insured regularly drives the rented or borrowed vehicle, or if it is made available for the insured's regular use, the insured's coverage will not apply

Explain how often an insured can drive a rented or borrowed auto and expect his or her auto physical damage insurance to cover the vehicle

because the PAP contains a fraud provision stating that no coverages exists for any insured who makes fraudulent statements or engages in fraudulent conduct in connection with any accident or loss for which a claim is made, the insurer would not be obligated to pay this claim

Explain how the PAP would respond in the following situations based on the provisions contained in Part F of the policy -The insured deliberately burns his car and submits a claim under the policy's physical damage coverage

the damage to the insured's car from racing would probably not be excluded. Loss to a covered auto is excluded if the auto is damaged while located in a facility designed for racing if the auto is being used to prepare for, practice for, or compete in any prearranged racing or speed contest. It appears that this race was not prearranged

Explain whether, if an insured decided to race his sports car against the driver of another car on a city street, damage to his car resulting from a collision that occurs during this activity would be excluded under his PAP collision coverage

amends physical damage coverage for leased vehicles or vehicles with outstanding loan amounts to include an unpaid amount due on the lease or loan

Frequently used personal auto endorsements: auto loan.lease coverage

covers each described vehicle for a stated amount of insurance as indicated in the endorsement schedule that applies to collision and OTC losses

Frequently used personal auto endorsements: coverage for damage to your auto

increases the $1,000 limit that applies to electronic equipment installed in a vehicle in locations not intended for the purpose of the auto manufacturer

Frequently used personal auto endorsements: excess electronic equipment coverage

provides liability and medical payments coverages for drivers of vehicles furnished or made available for the regular use of the named insured and/or family members

Frequently used personal auto endorsements: extended non-owned coverage

provides excess liability coverage over Mexican auto insurance for an insured who is involved in an accident or loss in Mexico within 25 miles of the US boarder on a trip of 10 days or less

Frequently used personal auto endorsements: limited Mexico coverage

covers motor homes, motorcycle,s and other vehicles with fewer than 4 wheels that are designed for off public use

Frequently used personal auto endorsements: miscellaneous type vehicle endorsement

provides liability, medical payments, uninsured, and underinsured motorists coverages for drivers who don't own an auto but regularly or occasionally drive another person's vehicle or a rental vehicle

Frequently used personal auto endorsements: named non-owner coverage

increases the limit of coverage for transportation expenses under coverage D (physical damages)

Frequently used personal auto endorsements: optional limits transportation expenses coverages

provides coverage for snowmobiles other than vehicles propelled by airplane-type propellers or fans

Frequently used personal auto endorsements: snowmobile endorsement

1 the number, type, r use of insured vehicles 2 the operators using insured vehicles 3 the place of principal garaging of insured vehicles 4 the coverage provided, deductibles, or limits of liability

Identify 4 changes an insured can make during the policy period that can result in a premium increase or decrease

2,000-500(deductible)=1,500

Jamal flew from his home in New York to California for a vacation. While there, he rented a car. Jamal declined all of the optional coverages that were offered to him at the rental agency. While driving the rental car, Jamal was at fault in a collision with a truck. The repairs to the rental car will cost $2,000. Jamal's Personal Auto Policy (PAP) has a $250 other than collision deductible and a $500 collision deductible. What amount will Jamal's insurer pay for the loss?

1. to reduce small claims 2. the hold down premiums 3. to encourage insureds to be careful in protecting their cars against damage or theft

List 3 reasons for deductibles in auto physical damage coverage

1. the premium has not been paid 2. the driver's license of an insured has been suspended or revoked during the policy period (or since the last annual anniversary of the original effective date if the policy is for other than 1 year) 3. the policy has been obtained by a material misrepresentation

List the 3 reasons for which an insurer can cancel a policy that has been in force for 60 or more days

-provide prompt notifications of the details of the accident or loss to the insurer -cooperate with the insurer in the investigation, settlement, or defense of any claim or suit -submit copies of notices or legal papers in connection with the accident or loss to the insurer -agree to submit to a physical examination if requested by the insurer -agree to be examined under oath if required by the insurer -authorize the insurer to obtain medical reports and other pertinent records -submit a proof of loss when required by the insurer

List the 7 general duties a person seeking coverage under the PAP must perform after an accident or a loss

Named Non-owner coverage endorsement attached to a PAP

Lori has a company car with insurance coverage provided by her employer and does she not own a car. On occasion, Lori helps her elderly grandmother, Nell. Lori occasionally drives Nell's car to pick up prescriptions. Lori knows that Nell has low limits of liability and is afraid that Nell might allow the insurance on her car to lapse. What coverage can Lori purchase to provide insurance for herself when she drives Nell's car?

Extended Non-Owned Coverage- Vehicles furnished or available for regular use endorsement

Marge and her husband Jack have a PAP to cover their 2 automobiles. Marge also has a company car provided by her employer. Which endorsement would best provide Marge with liability and medical payments coverage for her company car?

-the person seeking coverage must take reasonable steps after a loss to protect a covered auto or non owned auto and its equipment from further loss -if a covered auto or non owned auto is stolen, the person seeking coverage must promptly notify the policy of the theft -the person seeking coverage must permit the insurer to inspect and appraise the damaged property before its repair or disposal

Part E of a PAP states the general duties that the insured must perform after an accident or a loss. Additional duties are required if the insured is seeking payment under Part D- Coverage for Damage to Your Auto -Describe the 3 additional duties required if the insured is seeking payment under Part D of the PAP

it is important for insureds to perform the duties after a loss as outlined in Part E because if the insured does not perform them and this failure is prejudicial to the insurer, the insurer has no obligation to provide coverage and to pay for the loss

Part E of a PAP states the general duties that the insured must perform after an accident or a loss. Additional duties are required if the insured is seeking payment under Part D- Coverage for Damage to Your Auto -Explain why it's important for insureds to perform the duties after a loss as outlined in Part E of the PAP

Named Non-Owner Coverage Endorsement

People who don't regularly own an auto or who occasionally drive another person's vehicle or a rental vehicle can secure coverage for the loss exposures arising out of their use of a non owned auto by purchasing a PAP with the

The conditions under which the insurer can nonrenew a Personal Auto Policy (PAP) vary according to the length of the policy period. If the policy period is less than six months, the insurer has the right to nonrenew every six months, beginning six months after the policy's original effective date.

The conditions under which the insurer can nonrenew a Personal Auto Policy (PAP) vary according to the length of the policy period. If the policy period is less than six months, the insurer

does not provide coverage for snowmobiles used in business

The snowmobile endorsement to the PAP

an other than collision loss

Under the PAP, a branch falling from a tree and denting the hood of a covered auto is an example of

states that the policy will not benefit, either directly or indirectly, any bailee (a person who assumes custody of the property of others for business purposes).

What is the "No Benefit to Bailee" provision?

24 hours

What is the wait period for loss by other perils under both collision and OTC

48 hours

What is the wait period for total theft losses under OTC coverage

Appraisal

a method of resolving disputes between insurers and insured over the amount owed on a covered loss

Liberalization clause

a policy condition providing that if a policy form is broadened at no additional premium, the broadened coverage automatically applies to all existing policies of the same type.

Deductible

a portion of a covered loss that is not paid by the insurer

Proof of Loss

a statement of facts about a loss for which the insured is making a claim

Actual cash value (ACV)

cost to replace property with new property of like kind and quality less depreciation

Transportation expenses

coverage extension for substitute transportation costs incurred when a private passenger type auto has been stolen