PAP Review

What does the Auto insurance limits of 50/100/25 mean in coverage?

This is a split limit policy. The insurer pays a maximum of $125,000 for combined bodily injury (BI) and property damage (PD) per occurrence. Maximum $50,000 for bodily injury to one person, $100,000 for all persons injured, and $25,000 for property damage.

Which of the following coverages is NOT considered a Supplementary Payment on a Personal Auto Policy (PAP)?

Bodily Injury is included in the insuring agreement and is not considered a supplementary payment.

What is the purpose of the Automobile Assigned Risk Plan?

To provide coverage for drivers unable to obtain insurance normally because most states require auto insurance by law.

In a scenario where you negligently cause an accident resulting in Bodily Injury (BI) and Property Damage (PD) to the maximum of your policy limits of 30/60/20, how much will your insurer pay if your defense costs in a lawsuit amount to $8,000?

$88,000 total from $60,000 for BI, $20,000 for PD, and $8,000 for defense costs.

Under Coverage D, Damage to Your Auto, which of the following would be covered under Other than Collision?

Flood is covered under Other than Collision.

Who among the following is NOT covered to drive your 'covered auto' on your Personal Auto Policy (PAP)?

Your auto mechanic test driving your car is not covered.

Which statement is NOT true regarding Transportation Expenses on a PAP?

A deductible applies; however, it does not.

Which statement is NOT true regarding Medical Payments coverage on a PAP?

Coverage is to others, not you; it actually covers you and your passengers.

Which of the following is considered a Collision loss under a Personal Auto Policy (PAP)?

Your vehicle is struck by another vehicle causing a dent, and the driver leaves the scene.

Which classifications are used by insurance companies to set rates for Auto policies based on the Law of Large Numbers?

Age, gender, and location are the factors used.

What does Uninsured Motorist coverage typically cover?

Covers injuries caused by hit-and-run drivers.

Under the Coverage D - Physical Damage section of the Personal Auto Policy, when are Transportation Expenses provided?

Transportation expenses are covered up to $20 a day (maximum $600) without a deductible if your covered auto is stolen or damaged.

Which of the following would NOT be protected by the Medical Payments section of your Auto policy?

Persons in an auto with which you have collided.

What is NOT true about an Assigned Risk Auto plan?

It provides insurance to those who cannot afford it in the normal market.

Which coverage may be included in a Personal Auto Policy without the need for an Endorsement?

Transportation Expenses are automatically included.

In which situation would Liability insurance under a Personal Auto Policy provide coverage?

Insured who rents a private garage backs in and damages the garage.

Under the Supplementary Payments of a Personal Auto Policy, how much will the policy pay per day for loss of earnings for attending a hearing or trial?

$200 a day for loss of earnings.

Which accident would NOT be covered under the Uninsured Motorists coverage of your Personal Auto Policy?

An accident with a driver who carries the minimum Liability limits but whose insurance is not adequate to cover the damages.

Who determines the rates for the Automobile Assigned Risk Plan?

Participating carriers set their own rates filed with the Insurance Department.

What is NOT considered a Collision loss under a Personal Auto Policy?

Impact between a large animal and the covered auto.

What does Underinsured Motorists coverage typically cover?

It covers situations where someone negligently injures you, but their limits are inadequate.

Which statement is NOT true regarding Towing and Labor coverage on a PAP?

It is Supplementary Payment under Part D; it is actually an optional coverage.

Which statement is NOT true about the Appraisal clause under Part D of a PAP?

Expenses of the appraisal are charged to the party who demanded it.

What are the limits for Transportation Expenses coverage under a PAP?

$20 a day, up to a maximum of $600.

What is the most likely course of action for a real-estate agent who drives customers around in her own car?

Add Business Use to her Personal Auto Policy.

What happens if you are injured in an accident caused by another driver whose insurance does not cover all your injuries and damages?

Your Underinsured Motorist (UIM) coverage pays the remainder after the other driver's limits are exhausted.

Who is the Named Nonowner coverage endorsement used for?

Someone who does not own a car but drives borrowed or rented cars.

If a friend borrows your car and causes an accident while driving it, whose insurance applies?

Your policy applies first, and hers applies to any excess.

Which of the following scenarios is NOT excluded from coverage under a PAP?

Your teenager who takes your car without permission.

Where would coverage not apply under a PAP when driving outside your own state?

Coverage does not apply in Mexico.

On a PAP, which coverage does a deductible apply to?

Damage to Your Auto.

What does your insurance company pay for if your fully insured car is hit by an uninsured motorist?

Pays your BI under your Uninsured Motorists and your PD under Part D.

Which of the following is NOT an optional endorsement for the PAP?

Transportation Expenses are automatically included.

Which of the following situations would NOT be covered by the Liability part of your PAP?

Purchasing a motor home during the Policy Period and requesting to add it to the policy.

Which of the following statements is NOT true regarding the minimum Auto coverage represented by 15/30/10?

If you injured two persons for claims of $10,000 and $20,000 for the same occurrence, the insurer would pay out $30,000.

Which of the following is NOT defined as a trailer under a PAP?

A semi-trailer.

If your PAP has UIM limits of $50/$100 and you sustain bodily injury of $40,000 caused by another party with PAP BI limits of $15/$30, how much can you recover from your UIM coverage?

$25,000.