P&C Personal Automobile Policies 2

Question 1

Under Part A (Liability) of a personal auto policy, the insurer agrees to pay damages the insured is legally liable for involving:

Accepted Answer

Bodily injury and property damage to others arising out of the ownership, maintenance, or use of a covered auto

Answer

Only damage to the insured's own vehicle

Answer

Only injuries sustained by passengers in the insured's vehicle

Answer

Mechanical damage to the insured's vehicle

Question 2

Under the personal auto policy, which of the following is typically considered a 'covered auto'?

Accepted Answer

A vehicle newly acquired by the insured during the policy period, if reported within the required timeframe

Answer

A vehicle the insured borrowed from a neighbor without permission

Answer

A vehicle owned by an employer provided to the insured

Answer

A vehicle rented for a commercial delivery purpose

Question 3

What does 'split limits' mean in the context of auto liability coverage?

Accepted Answer

Separate maximum amounts per person injured, per accident for bodily injury, and per accident for property damage (e.g., 100/300/100)

Answer

A policy that pays half of each claim

Answer

A coverage that is split between collision and comprehensive

Answer

Coverage that alternates between primary and excess on a claim-by-claim basis

Question 4

Under a personal auto policy, 'medical payments' coverage (Part B) pays for:

Accepted Answer

Reasonable medical and funeral expenses for the insured and passengers, regardless of fault

Answer

Liability to third parties for injuries the insured causes

Answer

Lost wages of the insured after an accident

Answer

Damage to the insured's vehicle

Question 5

The 'permissive use' doctrine in auto insurance means that:

Accepted Answer

A person who has the insured's permission to drive a covered auto is generally covered under the insured's liability policy

Answer

Only the named insured is covered while driving

Answer

Permission is not required as long as the driver has a valid license

Answer

The insurer must give permission before the insured can lend their vehicle

Question 6

Under Part D (Physical Damage) of a personal auto policy, 'other-than-collision' (comprehensive) coverage includes loss caused by:

Accepted Answer

A tree limb falling on the parked vehicle

Answer

Rolling over the vehicle in a one-car accident

Answer

Rear-ending another vehicle

Answer

Swerving to avoid a deer and hitting a guardrail