Auto Insurance
Bail Bonds
$250 maximum amount for bail bonds because of an accident that results in bodily injury or property damage covered by the policy. Also incidents related to traffic law violations. ONLY for bail bonds, NOT traffic fines
Underinsured Motorists Coverage (UIM)
(ppl only carry state minimums) pays the difference between the insured's actual damages for bodily injury and the amount of liability insurance carried by the driver who was at fault, up to the limits of the insured's underinsured motorists coverage.
Limits of Physical Damage
-Actual cash value -Non-owned trailer = max $1,500 -Electronic equipment permanently installed in different location from original = max $1,000 -Deductible applies per occurrence
Who and where does coverage apply? (Physical Damage)
-covers named insureds and resident family members -but NOT passengers or pedestrians -US, Us Territories and US possessions, and Canada
Physical Damage coverage (Comp/Collision)
1. If another vehicle on the auto policy has physical damage coverage: a. Coverage begins the day car is acquired as long as insured requests coverage within 14 days of acquiring the auto. b. The new auto will have the broadest coverage provided for any vehicle already listed on the policy. 2. If no vehicles on the auto policy with physical damage: a. Coverage must be requested within 4 days after acquiring the auto. If a loss occurs in the time before coverage is requested, a $500 deductible applies.
1. Joint Ownership 2. Extended Non-owned 3. Named Non-owner
3 Ownership Endorsements
Part A - Liability Coverage Part B - Medical Payments Coverage Part C - Uninsured motorists Coverage Part D - Coverage for Damage to Your Auto Part E - Duties After an Accident or Loss Part F - General Provisions
6 Parts of Auto Insurance Contract
any bodily injury that's caused by the trailer is automatically gonna come from the vehicle that's pulling the trailer
A PAP insured is towing a rented trailer. The trailer comes loose, damages property and injures people. Which best explains how the PAP would respond?
his PAP extends liability to the trailer and the Part D - physical damage for the borrowed trailer
A PAP insured is towing a rented trailer. The trailer comes loose, damages property and injures people. Which best explains how the PAP would respond?
Single Limit
A lump sum to pay for both bodily injury and property damage
Yes, under permissive clause
A neighbor borrows Peter's car with Peter's permission. Will the neighbor have liability coverage under Peter's PAP? 🚗
No because parking cars is excluded
Alex was feeling good about his policy responding to take care of a car he didn't even own. He decided to make a little extra money parking cars at his Uncle's wedding reception. Unfortunately, he damaged a guest's BMW. Is there coverage under Alex's policy to handle the guest's $1,000 deductible?
A car driven with the required surety bond posted
All of the following are examples of an uninsured motorist EXCEPT:
The repair garage working on the insured's car
All of the following are included under Who's An Insured for liability under the auto policy EXCEPT
Owned jointly by unrelated persons whether or not they are living together
All of the following types of ownership are eligible for a Personal Auto Policy EXCEPT:
Angel's Med Pay will respond with $5000 available for each person injured (7 ppl in the van)
Angel is on a summer vacation road trip with his extended family. There are seven people in the van, including Angel. Angel has an accident on the highway and everyone in the van is injured, including himself. Angel has $5,000 in Medical Payments coverage. How will his Med Pay respond?
absolutely
Are passengers covered for their injury related expenses by Uninsured Motorists Coverage?
Rob's policy's Medical Payments coverage before collecting from her own Med Pay: $2,000 limit from Rob's policy first, and then $1,500 for the remaining amount from Sue's policy. Med Pay is primary when in your own car and excess when in someone else's car
Assume that Sue is seriously injured while riding in Rob's car. Sue and Rob both have Medical Payments coverage on their policies. Sue's medical bills total $3,500. Whose Med Pay will pay for Sue's injuries and how much? 🚑
Excluded Equipment Coverage
Audio, Visual and Data Electronics endorsement adds coverage for such equipment when permanently installed. Customizing Equipment provides coverage for added items like custom rims or specialty tires.
vehicle
Auto insurance(PAP) follows the _____
Temporary Substitute Auto
Auto or trailer you are using as a temporary substitute because of breakdown, repair, servicing, loss, or destruction.
yes the PAP will provide coverage according to the broadest coverage applicable to any covered auto shown in the Declarations
Beth has a PAP and includes her daughter as an operator. Her daughter borrows her friend's car for a trip and a tree limb falls on the car while parked. The friend's insurance had just lapsed. Does Beth's policy provide coverage for the borrowed car and what deductible would apply if covered?
$1,000 - if the radio is installed where in original manufactured lot, it'll be fully covered, if anywhere else, coverage is limited to $1,000
Clinton wanted a better stereo so he replaced the one that came in the car but it didn't fit in the same opening so he permanently installed it in a different location. If his stereo is stolen, how much coverage does he have?
Towing and Labor
Covers towing and costs of labor performed at the place of disablement. Typically limits available are $50, $75 or $100. Policyholders may purchase this protection and choose the level of protection.
Transportation Expenses
Covers transportation expenses due to physical damage loss to covered auto Covers loss of use expenses due to loss to a non-owned auto Pays $20 per day/$600 max 48 hour waiting period for total theft of auto 24 hour waiting period after other losses
Comprehensive - fire is a covered peril
Elaine's car malfunctions and catches on fire. How will her policy respond?🔥
Miscellaneous Type Vehicle
Endorsement allowing a Personal Auto Policy to be written for vehicles that do not typically fit the eligibility such as golf carts, motorhomes, motorcycles and ATVs.
Policyholder (customer) pays first because of the permissive clause, if not enough, the excess would be Courtesy Ford's
Fred is a mechanic at Courtesy Ford. While test driving a customer's car, he has an at fault accident and damages the customer's car. Whose policy responds to fix the customer's car- Fred's auto policy, the car owner's policy, or Courtesy Ford's policy?
Comprehensive
Fred was driving home late at night on a country road and hit a deer. What coverage will respond to repair his car?
on a per person basis, regardless of the number of persons injured in the vehicle
How are Medical Payment limits applied?
Yes
If Aaron goes to get pizza for us and he is in an accident and someone finds out that he works for LM, would LM be covered under his policy?
The vehicle owner's policy is always primary, and the driver's policy, if any, is always excess. Alex's policy will be primary here
If Alex borrowed his neighbor's pickup truck to run to Home Depot and had an accident, only to discover that the neighbor's insurance just lapsed. Will Alex's policy respond to repair the truck or is the neighbor out of luck?
Out-of-State Liability Coverage
If an accident occurs in another state that has financial responsibility laws requiring liability limits higher than your limits, the policy will provide the higher specified limit.
Medical Payments Coverage
In the event you are hurt in an accident and taken to the hospital, Medical Payments Coverage pays for your initial medical expenses related to the accident, regardless of who is at fault, The passengers in your car are also covered, as well as family members living with you if they are injured as pedestrians or when riding in another person's car -Ambulance transportation to the hospital. -Emergency room care. -The initial hospital stay. -Other reasonable medical and funeral expenses resulting from the accident.
Medical payments
In the event you are hurt in an accident and taken to the hospital, this pays for your initial medical expenses related to the accident, regardless of who is at fault, The passengers in your car are also covered, as well as family members living with you if they are injured as pedestrians or when riding in another person's car
Occupying
In, upon, getting into, onto, out of, or off of a vehicle. Example: High school senior gets on the hood of a friend's car to celebrate graduation and gets seriously injured.
excess
Is an insured's Medical Payments coverage primary or excess when injured while occupying non-owned vehicles?
How the Company May be Sued
Legal action against the insurer cannot be taken until all policy terms have been complied with and the company has agreed in writing that an insured has an obligation to pay
denied- he only has 4 days to request coverage since his policy did not include physical damage
Leroy had an older pickup truck and carried only Liability and Medical Payments coverage on his policy. He traded the pickup in on a new model and forgot to tell his insurance company until his new truck was stolen 10 days later. How will his auto policy respond?
Angel's Med Pay will respond with $5,000 available for each person injured (7 people in the van)
Let's say Angel is on a summer vacation road trip with his extended family. There are seven people in the van, including Angel. Angel has an accident on the highway and everyone in the van is injured, including himself. Angel has $5,000 in Medical Payments coverage. How will his Med Pay respond?
$2,400
Mark collides with a tree. He leaves his truck at the scene and goes to call a tow truck. He returns to find his golf clubs missing. Mark's losses include $2,500 to repair the truck and $1,200 to replace the golf clubs. He has a $100 deductible on collision and comprehensive. How much will his auto policy pay?
Freezing is an exclusion
Martin lives in an apartment complex in Maine and parks his car in the parking lot. During an ice storm, his windshield freezes and cracks. As he opens the door, the frozen handle also cracked and fell off. How will his auto policy respond? 🌨❄
2850
Melvin has a PAP with Part D - Damage to Your Auto deductible of $250 for Collision and $100 for Other Than Collision. If Melvin runs into a large cow and has $2,950 damage to his auto, his Part D Coverage will pay:
Yes, Uninsured Driver
Michelle was injured when she was struck by a car while walking across the street. The driver left the scene of the accident and could not be identified. Would this loss be covered under Michelle's PAP? If so, which part? 🚶♀️🚙
Collision; the guardrail and the damage to her vehicle will be fixed, but the tires will be excluded
Monica's tires were very worn and one blew out on the interstate causing her to lose control and hit a guard rail. She filed a claim for the guard rail, the repair costs of her car, and four new tires. What coverage will respond and how?
$132,000 (defense costs are in their own bucket)
Ms. Rhinehart has a Personal Auto Policy with liability limits of $100,000. If she has an accident and is found to be negligent, how much would her policy pay if there was a $120,000 judgment and $32,000 in defense costs?
Taxi, workers comp
Name two exclusions for uninsured motorists coverage🚕
Who is covered under Uninsured Motorist?
Named insureds, resident family members, passengers in the vehicle
Medical Payments
Nancy was inured when she lost control of her car and hit an embankment. Which part of her PAP will cover her medical expenses? 🏥
Liability - property damage
Ned loses control of his car and hits a parked car. Which coverage of Ned's PAP will pay for the damage to the parked car? 🚘
loss of income up to policy limits
On a PAP, Medical covers all EXCEPT:
Policy Cancellation
Policies may be cancelled by the insurer or the insured. State statutes impact cancellation and notice requirements for both cancellation and non-renewal notices to protect the interests of both.
Policy Changes
Policyholders make changes to their policies such as adding vehicles or operators and changing coverages or deductibles. The insurance company responds to a change by sending an endorsement reflecting the change and premium.
Named Non-owner
Provides liability, Med Pay and UM to individuals who do not own an automobile to cover them when driving cars owned by others.
Optional Transportation Expenses
Purchase additional limits above what is provided in Part D ($20 per day/$600 max).(car rental)
Family Member
Relatives, wards, and foster children in the household of the named insured.
The camper body would not be covered since he didn't cover it within 14 days
Ross insured his pickup truck with you. Several months later, he had a camper body installed and forgot to call in to add it to his policy. Another month later, he totaled the truck. How will the policy respond with regard to the value of the camper body? 📲
Policy Period
Some insurance companies write policies for 6 months and others for 12 months
30/60/25 First number - bodily injury if one person Middle number - bodily injury if more than one person is injured Third number - property damage
Split Limits of Liability
Flip (upset) is covered under Collision
Suzanne loses control of her car on an icy road and it flips over. What coverage will respond? ☃
Loss of Earnings
The insurance company will pay up to $200 per day for your lost earnings if they require your attendance at hearings or trials.
$105,000 (80+10+15)
The insured has a PAP with single liability of $100,000. The following loss occurs: $80,000-BI pedestrian; $10,000-Street Light; $10,000- Insured's sports car; $15,000-Legal defense. How much would his policy pay for the loss from the liability coverage?
Aggregate Limits
The most the policy will pay for all losses submitted during the policy period, regardless of other policy limits.
Fraudulent Activity
The policy does not provide coverage when the insured engages in fraud or misrepresentation
Transfer of Interest
The policy prevents the insured from assigning the policy to another except in the case of death when the policy may benefit the surviving spouse in the same household until the end of the policy period
Comprehensive
Think about the value of your own car. If your car were stolen, could you afford to pay to replace the car? What coverage could you purchase on your policy to pay that claim?
Extended Non-owned
This endorsement overrides the exclusion on regular use of a non-owned auto. It extends liability from policyholder's auto policy to also cover a vehicle they don't own but use regularly like a company car. The endorsement may also include Med Pay.
3 years after the accident
Time limit on Medical Payments
True
True /False - The following scenario would be excluded under Part A of the PAP: While riding his motorcycle through the neighborhood, Herman hits a parked car, damaging the car's bumper and grille.
True
True or False? Carolyn is injured in an accident caused by an intoxicated driver. She lives in a state with no-fault laws and carries Personal Injury Protection. Carolyn's Personal Injury Protection will respond first before the at-fault driver's bodily injury liability.
False - injury expenses, pain and suffering are covered but vehicle damage is NOT covered
True/False - Barb is hit by a drunk driver who is uninsured. She is not injured, but her car is totaled. Barb's loss will be paid under Uninsured Motorists coverage 🚘💢♀️
False
True/False - Medical payments coverage provides protection for occupants of a vehicle that is struck by the insured's vehicle🚗💥🚘
Policy Territory
United States, its territories or possessions, Puerto Rico, or Canada.
The company will provide the highest of the limits
What coverage is provided by the PAP when the vehicle is driven out of state? 🗾
Comprehensive Coverage
When a vehicle is damaged as the result of an incident other than a collision. An optional coverage that will pay the cost, minus the amount of the deductible, of repairing or replacing it. (something beyond your control like impact with an animal or something falling out of the sky, etc)
Combined Single Limit
When one limit is shown for both BI and PD on a PAP, it is known as:
Subrogation
When the insurance company pays a claim to the insured and seeks to collect from the at-fault party to recover payment.
1. All US states 2. US territories and possessions 3. Canada
Where does Medical Payments apply? 🗺
Choose UM limits greater than the BI limit
Which of the following is NOT a valid option for a customer's Uninsured Motorist Coverage selection?
insured's daughter who lives in another nearby city
Which of the following is NOT defined as a 'family member' in the Personal Auto Policy?
permissive use to the insured's vehicle
Which of the following is covered under PAP liability coverage?
damage you cause to a non-owned garage
Which of the following situations would be covered by liability under your personal auto policy?
Declarations
Which portion of the auto policy contains the coverage and limits the customer selected?
-The Named Insured and family members using the vehicle; -Anyone given permission to use the vehicle; -Anyone legally responsible for the acts or omissions of anyone insured under the auto policy, but only to the extent they would have defended you anyway.
Who is covered by liability?
1. named insureds and any family member that is occupying the insured's or another vehicle - named insureds and any family member that is struck by another vehicle. 2.Any other person while occupying the insured's vehicle
Who is covered on medical payments?🏥
Collision
You recently sold a policy to Dave. He ran into the back of another car at an intersection. What coverage will Dave need to repair his car? 🚗💥🚙
Where did you install the satellite radio?
You sold Danny an auto policy. In conversation, he mentioned he just put in a satellite radio system. Today he called you to report his car stolen and was very worried about the radio. To determine how much coverage he has for the radio, what question do you need to ask him?
Uninsured Motorist (UM)
a liability coverage that is purchased on your own auto policy to cover you and your passengers in the event you are hit by another negligent driver that has no auto insurance coverage. This includes being hit in a hit&run accident. Does NOT cover damage
Non-owned Auto
any private passenger auto, pickup truck, trailer, or van not owned by or available for regular use of the named insured or family member. An example of this is a short-term rental car
Covered auto
any vehicle shown in the Declarations, a newly acquired auto, and any trailer you own.
Bodily injury liability
covers costs associated with injuries or death that you or another driver causes while driving your car
Joint Ownership
endorsement used to cover multiple owners when 2 or more relatives who may not reside together or unrelated individuals residing together.
Appeal Bond and Interest
if you were involved in an auto accident and the other party that you injure places a lawsuit against you, your insurance company will defend and pay the cost of the lawsuit. If company loses the lawsuits and appeals, then loses the appeal, they will pay the judgments plus any Accrued Interest on the judgment
No Fault Coverage
often require that injury costs be paid first from the individual's own policy. The injured party is compensated no matter who is at fault.
Uninsured Motorists Property Damage Coverage (UMPD)
pays for damage to your vehicle when hit by an uninsured driver.
Comprehensive
provides coverage against theft and damage caused by an incident other than a collision that are out of your control such as fire, flood, vandalism, hitting an animal, hail, falling rocks or trees and other hazards—even getting hit by an asteroid!
Glass Coverage
provides coverage from windshield damage, which is common
You/Your
refers to the named insured and resident spouse
Property Damage Liability
reimburses others for damage that you or another driver operating your car causes to another vehicle or other property, such as a fence, building or utility pole
Collision
reimburses you for damage to your car that occurs as a result of a collision with another vehicle or other object—e.g., a tree or guardrail—when you're at fault
Property
such as damage to or theft of your car
Comprehensive Deductible
the amount of money you will pay out-of-pocket in the event of damage to your car not caused by a collision.
Collision Deductible
the amount of money you will pay out-of-pocket in the event that a collision damages your car
Medical Payments
the cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses
Part D Physical Damage Coverage
this part of the Personal auto Policy covers for damage to your own vehicle Pays for direct and accidental loss to the named insured's covered vehicle against collision or other than collision (comprehensive) - Does not cover personal property in the vehicle
Collision Coverage
when a vehicle is damaged in an accident, collision insurance is an optional coverage that pays the cost of repairing or replacing it, minus the amount of the deductible
Liability
your legal responsibility to others for bodily injury or property damage