Section 3A

Question 0

Split limit policy is commonly expressed as

Answer 0

30/60/25

Question 1

Every motor vehicle operated on a state highway , except farm vehicles that are operated only incidentally, must

Answer 1

Satisfy the minimum financial responsibility requirements through certificate of insurance, surety bond, certificate of deposit , cash held by treasurer, or an auto liability insurance policy

Question 2

Excess limits

Answer 2

Higher than required limits for a slightly higher premium

Ex: 100/300/50 are common

Question 3

Some insurers also offer

Answer 3

Combined single limits (CSL)

This is written with one policy limit and applies to BI and PD together

Question 4

UM (Uninsured Motorists) usually covers

Answer 4

BI only

Question 5

BI liability is for the other party you injure, while UM liability is for

Answer 5

You and your passengers in case you are injured by an uninsured motorist and it is his or her fault

Question 6

Most auto liability policies also have supplementary or additional coverages that may

Answer 6

pay in addition to the policy limits

Question 7

Personal Auto Policy (PAP) is the

Answer 7

Broadest type of personal lines auto policy sold

Question 8

The business auto policy is designed for vehicles

Answer 8

in commercial use, such as pickup and delivery of goods or merchandise.

Question 9

‘Business Use’ is the

Answer 9

Use of a vehicle in sales, by a person such as a real estate agent or perhaps an insurance agent. It requires higher rates.

Question 10

Auto Insurance rates depend on who is

Answer 10

Driving the car and where the car is being driven

Question 11

Rate Classifications are based on

Answer 11

Age
Gender
Driving Record
Territory

Question 12

Rate differences are based on

Answer 12

Verifiable statistical data

Question 13

The worse the driving record,

Answer 13

The higher the rates

Question 14

Liability insurance (BI and PD)

Answer 14

Is to others

Question 15

There are three areas of auto insurance you should be fully aware of

Answer 15

Rates
Underwriting
Coverage

Question 16

In the process of underwriting, the underwriter considers and investigates the application, and upon

Answer 16

Acceptance, and signs her name on the application.

She may look at the MVR or Comsumer Investigative Report.

Question 17

If the underwriter disagrees with the agent, the agent is given the opportunity to supply

Answer 17

Additional information that may make a difference in the underwriter’s decision. If it does not, it may be rejected if the risk was too great.

Question 18

No auto policy

Answer 18

Covers motorcycles

Question 19

PAP (Personal Auto Policy) has the following parts

Answer 19

Part A- Liability (BI and PD to others)
Part B- Medical Payments (pays medical and
funeral expenses resulting from a
covered event to you and your
passengers)
Part C- Uninsured Motorists (covers BI to an
insured caused by an owner or
operator of an at-fault uninsured veh)
Part D- Damage to Your Auto (covers your
insured veh for damage by collision
or other than collision , if either or
both are declared)
Part E- Duties After an Accident (insured must
notify the insurer ASAP after loss and
must cooperate with insurer’s
investigation)
Part F- General Provisions (lays out various
legal and financial obligations
relating to both insurer and insured)

Question 20

Declarations page

Answer 20

Tells who is insured,what type of property(auto) is insured, the policy limits, and the policy period.

Question 21

Part A-Insuring Agreement

Answer 21

“We will pay damages for bodily injury or property damage for which any insured becomes legally responsible because of an auto accident.”

Question 22

Bodily Injury

Answer 22

Bodily harm, sickness or disease, including death that may result.

Question 23

Property Damage

Answer 23

Physical injury to, destruction of , or loss of use of tangible property.

Question 24

Insured is defined as

Answer 24

You (named insured or spouse) or any family member , Any person using any covered auto, and Any person or organization for a covered auto.

Question 25

'Family Member'

Answer 25

A person related to you by blood, marriage, or adoption who is a resident of your HH

Question 26

Order of Precedence

Answer 26

The owner's policy is always primary. | The driver's policy, if any, is always excess.

Question 27

The owner's policy

Answer 27

Pays first and the driver's policy pays any excess above the limits of the owner's policy

Question 28

Contractual Liability

Answer 28

Once the owner's policy limits have been exhausted will the excess insurance be responsible for further damages to the injured party.

Question 29

A trailer is automatically

Answer 29

Covered for liability insurance without charge

Question 30

Covered Auto

Answer 30

Any veh on Dec page Any additional auto newly acquired (notify within 14 days) Newly Acquired Vehicle Replacement Any trailer you own Non-owned vehicle used as a temporary substitute

Question 31

Part A-Insuring Agreement

Answer 31

"We will settle or defend ...any claim or suit...In addition to our limit of liability , we will pay all defense costs we incur." Cost of Defense is in the Insuring Agreement!

Question 32

Part A-Supplementary payments included at no additional charge. They are in addition to limits.

Answer 32

$250 bail bonds (due to accident not traffic fines) Appeal Bonds and Interest Loss of Earnings up to $200 per day

Question 33

Part A exclusions

Answer 33

``` Intentional acts Your own property in transit Injury to Employees Taxi or Livery Auto business Commercial usage Using a vehicle without permission Non-owned vehicle furnished for your regular use ```

Question 34

Part A Out of State Coverage The PAP will automatically

Answer 34

Conform to the state laws of any state in which you happen to be driving.

Question 35

There is no coverage in

Answer 35

Mexico or any foreign country other than Canada.

Question 36

Part A financial responsibility: The PAP is acceptable as

Answer 36

Proof of financial responsibility in all states.

Question 37

Evidence of liability insurance as proof of financial responsibility is often required after a person is involved in an

Answer 37

Uninsured accident, has been convicted of a major traffic violation, or has been found to have violated the state mandatory insurance law.

Question 38

SR-22 filing

Answer 38

A form indicating a promise to notify the state if his or her insurance policy is canceled for any reason

Question 39

Part B-Medical Payments Coverage

Answer 39

Part B-Insuring Agreement: Auto medical is an optional coverage. It is not liability coverage, but provides coverage for reasonable expenses incurred, within 3 years from the date of the accident, for necessary medical and funeral services.

Question 40

The insuring agreement goes on to define insured in this part as:

Answer 40

1. The named insured, spouse, or any family member while occupying , or as a pedestrian when struck by, a motor veh designed for use mainly on public roads 2. Any other person who is occupying a covered auto

Question 41

Part B limits of liability

Answer 41

No fault coverage It's for injuries sustained by you and your passengers.....

Question 42

Part C insuring agreement: UM (uninsured motorists)

Answer 42

Liability coverage purchased on your own policy in case you or your passengers are injured by another motorist who is negligent and has no auto liability insurance. It also covers if you are injured by a hit-and-run driver.

Question 43

Uninsured Motor Vehicle

Answer 43

No liability policy Policy for liability written for lower limits than specified by state law Hit and run vehicle Has liability policy but insurer denies coverage or is insolvent

Question 44

UM (Uninsured Motorists)coverage

Answer 44

For BI only!!!!

Question 45

If an UM (Uninsured Motorist) caused property damage to your insured auto,

Answer 45

You turn in your claim under Part D (Collision)

Question 46

UM limits must match the

Answer 46

State Minimums for BI

Question 47

UIM (Underinsured Motorists) Coverage | You pay the additional premium.

Answer 47

This only applies when the other party who negligently injures you has insurance but NOT enough.

Question 48

Part D Insuring agreement

Answer 48

Optional coverage to protect your own car Part D premiums are based primarily on the value of the car you are insuring. It has two separate coverages: collision and other than collision

Question 49

Collision

Answer 49

Upset of your covered auto or its impact with another vehicle or object

Question 50

Other than Collision (OTC)

Answer 50

``` Missiles Falling objects Fire Theft or larceny Explosion or earthquake Windstorm Hail, water, or flood V&MM Riot Contact with bird or animal Breakage of glass ```

Question 51

Part D promises to pay for direct and accidental loss to either your covered auto or any non-owned auto but not

Answer 51

A temporary substitute

Question 52

Part D transportation expenses No extra premium No deductible In addition to limits

Answer 52

$20 per day, up to a max of $600

Question 53

Part D Limit of Liability If a claim occurs under part D, the company has the option of paying the ACV of the stolen or damaged property or repairing or replacing the car,

Answer 53

Whichever is cheaper.

Question 54

Appraisal

Answer 54

Used when insurer and insured do not agree on the ACV of the loss Two appraisers and umpire Decision made by two of the three parties

Question 55

Part E-Duties after an accident or loss

Answer 55

Requires that notice of claim be filed promptly and that the insured cooperate in the investigation, settlement, or defense of any claim or suit.

Question 56

Part F-General Provisions Policy Territory

Answer 56

CUP= Canada, USA, and Puerto Rico Additional general provisions relate to cnx and non-renewals (10 days notice for nonpayment)

Question 57

PAP Endorsements (with additional premium charge) Named non-owner

Answer 57

Modified contract that covers non-owned vehicles only This is sold only to non-owner drivers

Question 58

PAP Endorsements Miscellaneous Type Vehicles

Answer 58

4 wheel passenger vehicles like a motor home, a motorcycle, a dune buggy, or a golf cart. Add this special endorsement to modify the definition of a covered auto.