Unit 8 Personal Auto Insurance

Question 1

The ____ is a policy containing property and liability coverages. It is designed to insure an individual, not a business.

Answer 1

Personal auto policy (PAP)

Question 2

The personal auto policy consists of a ____ and a ____.

Answer 2

Declarations page, Policy form

Question 3

The policy form contains 4 separate coverages, each with its own insuring agreement, exclusions, and conditions:

Casualty
* Part A - ____
* Part B - ____
* Part C - ____
Property
* Part D - ____

Answer 3

A. liability coverage
B. medical payments coverage
C. uninsured motorists coverage
D. coverage for damage to your auto (physical damage)

Question 4

The policy uses the words YOU and YOUR to refer to the ____.

Answer 4

Named insured

Question 5

A ____ is any person related to the named insured or spouse who is a resident of the named insured’s household. This includes those related by blood, marriage, or adoption, and ward or foster children.

Answer 5

Family member

Question 6

____ means:
* in a vehicle
* upon a vehicle
* getting int, onto, out of, or off a vehicle

Answer 6

Occupying

Question 7

____ means destruction of or loss of use of tangible property.

Answer 7

Property damage

Question 8

Covered Auto includes: (4)

Answer 8

1. Any vehicles listed in declarations
2. Newly acquired autos
3. Trailers
4. Temporary substitutes (includes trailers)

Question 9

Covered Auto - ____ are four-wheel motor vehicles, pickup trucks, and vans that are under 10,000 lbs of gross vehicle weight (GVW) and are not used for business purposes (farming and ranching are not considered businesses). The vehicles must be owned or leased under a long-term contract of ____ months or more.

Answer 9

Private passenger autos, Six

Question 10

Covered Auto, Trailers: when are farm wagons or implements included?

Answer 10

While being towed by a vehicle listed in the declarations

Question 11

Does the insurer need to provide advance written notice to cancel the policy?

Answer 11

Yes

Question 12

The ____ includes the US, its territories and possessions, Puerto Rico, and Canada.

Answer 12

Coverage Territory

Question 13

Are covered autos insured while being transported between territorial ports?

Answer 13

Yes

Question 14

____, or automobile insurance plans, are voluntary agreements between insurance companies licensed in a particular state. These companies agree to share the poor risks among themselves. Because these risks are randomly assigned to the participating companies, they are called ____. Each company accepts its share of ____ drivers according to the size of the individual insurance company.

Answer 14

Assigned risk plans

Question 15

Would the 16 year old son of the insured be covered while using the insured’s car?

Answer 15

Yes

Question 16

Would ANYONE using the insured’s car with the insured’s permission be covered?

Answer 16

Yes

Question 17

Supplementary Payments: which acronym would apply for supplementary insurance that is AUTOMATICALLY included with no increase of premium?

Answer 17

BAILED

Question 18

Is personal property or property rented that’s being transported by the insured covered?

Answer 18

No

Question 19

If your 16 year old son takes your car out on a joy ride without permission and gets into an accident, will it be covered?

Answer 19

Yes, the use of a vehicle without permission condition does not apply to family members

Question 20

Are vehicles with fewer than 4 wheels covered?

Answer 20

No

Question 21

Are vehicles designed for off-road use covered?

Answer 21

No, however this does not apply to golf carts

Question 22

Are vehicles used for prearranged racing or speed contests covered?

Answer 22

No

Question 23

A PAP with one figure representing the coverage for both bodily injury and property damage is known as ____.

Answer 23

Combined Single Limit

Question 24

Liability coverage is most often represented on/as a ____ basis. Ex: 100/300/50…Define what these numbers represent
A. ____
B. ____
C. ____

Answer 24

Split limits
A. 100k per person for bodily injury or death
B. 300k per accident for bodily injury or death
C. 50k per accident for property damage

Question 25

Out-of-State Coverage Provision: While temporarily driving in another state, the insured’s liability coverage will pay the higher of: (2)

Answer 25

1. The insured’s liability policy limits
2. The other state’s minimum liability requirements

Question 26

The ____ clause for liability coverage states that the company will pay only its share of a loss that is also covered by other insurance. The company’s share is the proportion that its policy limit bears to the total of all applicable limits.

Answer 26

Other Insurance Clause

Question 27

Part B covers reasonable expenses for necessary medical and funeral services incurred within ____ years of the date of the injury, regardless of fault.

Answer 27

3 Years

Question 28

Does part B cover you while walking along a roadway?

Answer 28

Yes, this includes your family as well

Question 29

Does part B cover the medical bills of people not in your car?

Answer 29

No, that would be covered by part A

Question 30

Newly Acquired Autos: If the insured has an auto policy in force and acquires a new vehicle, the newly acquired vehicle will automatically have the same coverage as the existing vehicles. However, in order for this coverage to continue, the insured must notify the insurance company within ____ days after becoming the owner.

Answer 30

14 Days

Question 31

Newly Acquired Autos: …“if no coverage, must request coverage within ____ days…”

Answer 31

4 Days (if a loss occurs within the first 4 days and the insured has complied with the notification, $500 deductible will apply)

Question 32

Does part A cover any personal property in the vehicle?

Answer 32

No

Question 33

Part D, Transportation Expenses Coverage: This may include rental cars, bus fares, train fares, or cab fares. This coverage pays up to $____/day to a maximum of $____.

Answer 33

$30, $900

Question 34

Part D, Transportation Expenses Coverage: For transportation expenses arising out of the total theft of the auto, there is a ____- hour waiting period before expenses will be paid. For other types of losses there is a ____- hour waiting period.

Answer 34

48, 24

Question 35

Other Provisions: Physical damage losses are reimbursed for ____ or repair and replacement, whichever is less.

Answer 35

Actual Cash Value

Question 36

Other Provisions: The most the policy will pay for loss to a non-owned trailer is $____. Coverage for electronic equipment that is permanently installed in an area of the car that is not normally used by the manufacturer for this equipment is limited to $____.

Answer 36

$1500, $1000

Question 37

When the ____ endorsement is attached, the policy can be issued to two or more unrelated people who live in the same household or two or more people who are related in another way besides being spouses.

Answer 37

Joint Ownership Coverage

Question 38

The ____ endorsement reimburses the insured up to the amount scheduled in the policy for towing and labor costs each time a covered auto is disabled. Labor must be performed at the place of disablement; work performed after the vehicle is taken to a garage is not covered.

Answer 38

Towing and Labor Costs

Question 39

The ____ endorsement may be added to the personal auto policy to provide coverage for motorcycles, mopeds, and recreational vehicles such as motor homes and golf carts.

Answer 39

Miscellaneous Type Vehicle

Question 40

The ____ endorsement expands the extensive coverage automatically provided under the personal auto policy for the insured and the family while driving cars other than the insured’s covered autos. It eliminates most exclusions applicable to autos that are furnished or available for the regular use of the named insured or family members (such as a company car).

Answer 40

Extended Non-owned Coverage - Vehicles Furnished or Available for Regular Use

Question 41

Which acronym applies to the supplementary payments of a PAP?

Answer 41

BAILED

Question 42

Other than Collison Coverage: (10)

Answer 42

1. Missiles or falling objects
2. Fire
3. Theft or larceny
4. Explosion or earthquake
5. Windstorm
6. Hail, water, or flood
7. Malicious mischief or vandalism
8. Riot or civil commotion
9. Contact with bird or animal
10. Breakage of glass

Question 43

What is the equation for other insurance? (When there are two insurers such as in an example of a person renting a car - the insured’s policy is considered excess insurance)

Answer 43

Personal Policy Limits / Total Policy Limits X Loss

Question 44

Other than Collision coverage is also know as?

Answer 44

Comprehensive Coverage