Personal Automobile Policies Flashcards

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

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

Part A covers the insured's legal liability for bodily injury and property damage caused to third parties arising from the covered auto's ownership, maintenance, or use.

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

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

A newly acquired vehicle is automatically covered under the PAP for a specified period (typically 14–30 days), and full coverage continues if reported to the insurer within that window.

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

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

Split limits express liability coverage as three separate amounts: maximum per person for bodily injury, maximum per accident for bodily injury (all persons), and maximum per accident for property damage (e.g., 100/300/100 means $100K per person, $300K per accident BI, $100K per accident PD).

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

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

Part B (Medical Payments) covers reasonable medical and funeral expenses for the named insured, household residents, and any occupant of a covered auto, regardless of who caused the accident.

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

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

Under permissive use, someone who has express or implied permission from the named insured to drive a covered auto is typically covered under the insured's PAP for liability purposes.

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

Answer: A tree limb falling on the parked vehicle

A tree limb falling on a parked vehicle is an 'other-than-collision' peril (comprehensive), not a collision. Striking a guardrail and rolling over are both collision losses.