Chapter 3- Personal Auto Policy (PAP) Flashcards

1
Q

Which of the following is NOT eligible for vehicles under PAP?

a) Pickup truck with a lease of three months
b) A four-door sedan
c) A pickup truck with a topper on the back
d) Sporty car that is a two-door

A

a) Pickup truck with a lease of three months

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2
Q

A father and daughter, co-owners of a car, live together: Can the agent list both as the Named Insureds?

A

Yes, since father and daughter reside together, there is no problem

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3
Q

Clancy owns his own business as a sole proprietor. Can the agent sell him PAP?

A

Yes, since the sole proprietor is classified as an individual

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4
Q

Jerry Cheat and Bruce Swindle are partners in the law firm of Cheat and Swindle. Can the agent sell this partnership a PAP?

A

No; since this law firm is a business partnership, the agent would have to sell them a Commercial Auto policy

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5
Q

All of the following are considered to be the insured’s covered autos under the Personal Automobile Policy, except:

a) The vehicle listed on the Declarations page
b) A dump truck being used because the insured’s vehicle was in a collision
c) Newly acquired vehicle
d) A rental car

A

d) A rental car

While coverage could be provided, the question did not state that the rental car was being used due to breakdown or collision of the insured’s car. Therefore, a stand-alone rental car is not automatically covered

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6
Q

The insured has a PAP and her employer asks her to run an errand in her own car, to go down to the office supply store. She was involved in an accident, and she and the employer are both sued. Who will be defended under the PAP of the insured?

a) The insured
b) The employer
c) The insured and the employer
d) No coverage will be provided

A

c) The insured and the employer

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7
Q

Sam and Mark went to go play golf. They finished playing golf and put both sets of golf clubs in the back of Sam’s automobile. While they were stopped to get something to drink, both sets of golf clubs were stolen out of Sam’s car. How are Mark’s golf clubs covered?

a) Sam’s automobile policy
b) Mark’s automobile policy
c) Sam’s Homeowners policy
d) Mark’s Homeowners policy

A

d) Mark’s Homeowners policy

Theft is a covered peril under Homeowners

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8
Q

Johnny is a mechanic who was driving a customer home in the customer’s car when it caught on fire. How much of that damage is payable under Johnny’s PAP?

A

No money is payable, since Johnny is a mechanic, and he is in the business of repairing cars. Garage insurance is necessary.

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9
Q

The insured had an at-fault accident. The first claimant (1) had $25,000 in Property Damage. Insurer must defend, paying attorney’s fees out of the Supplementary Payments. The insurer will pay $25,000, since the insured was at-fault. When the insurer pays out that $25,000, the payment will reduce the balance remaining to $5,000. This is the remaining money to pay for all Bodily Injury and Property Damage in any one claim. The second driver (2) sustained $10,000 damage to the second vehicle.

Does the insurer defend for this $10,000 claim?

A

Yes, it will defend, since money remains in the per-accident limit amount

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10
Q

This accident involved three vehicles, and the next person sued the insured for $4,000.

Will the insurer defend the insured on this $4,000 claim?

A

No, it will not defend this claim, since no money is left in the policy limit amount. If the injured person wants to be reimbursed for damages, what entity will pay that person? The insured’s pocket will reimburse that injured person

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11
Q

What does an individual have to prove in order to satisfy the Financial Responsibility Law?

a) Personal Injury Protection
b) Personal Injury Protection and Property Damage Liability
c) Personal Injury Protetion and 10/20/10 Liability coverage
d) 10/20/10 Liability coverage

A

d) 10/20/10 Liability coverage

  • Liability coverage of 10/20/10 is the qualifier for the Financial Responsibility Law
  • PIP is the qualifier for the No-Fault law
  • PIP and Property Damage Liability are the qualifiers for the Tag Law
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12
Q

Which of the following does NOT trigger the Financial Responsibility Law?

a) Bodily Injury accident
b) An accident with a small amount of property damage
c) DUI/DWI
d) The vehicle is used in the commission of a felony

A

b) An accident with a small amount of property damage

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13
Q

An insured has 10/20/10 coverage in Florida and drives through Alabama on vacation, where he is involved in an auto accident. If Alabama’s minimum requirements are 20/40/10, how will the policy respond?

A

The insured’s policy will meet the minimum of the state in which the individual travels. If the limits were already higher, the insured keeps those higher limits. The premium will not change regardless.

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14
Q

John is walking across the street to go to the county fair when he is struck as a pedestrian by a motorcycle. Which of the following provides coverage?

a) PIP
b) Medical Payments
c) PIP, then Medical Payments
d) No coverage is extended under the PAP or Medical Payments

A

b) Medical Payments

Medical payments will provide coverage, since the insured was struck as a pedestrian. No coverage is provided under PIP since the motorcycle is not a Defined Motor Vehicle

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15
Q

Frank is the insured. Frank carries $2,000 worth of Medical Payment coverage. His daughter, Sarah, is riding in her friend, Sally’s car. Sally has $2,500 of Medical Payment coverage. Sarah and Sally get in an accident and Sarah suffers injuries resulting in $3,100 of medical bills. Ignoring PIP, what percentage of Sarah’s medical bills will be paid under Frank’s Medical Payments coverage?

A

Sally’s coverage must pay first ($2,500)
Sarah can make a claim against the policy of her own household, and she can claim the remaining $600 in medical bills from Frank, her father’s Medical Payments

Golden Rule number 1- coverage of the car in the accident is always primary

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16
Q

All of the following are considered uninsured motor vehicles under the policy except:

a) The insured was at-fault in the accident
b) The at-fault driver fled the scene of the accident
c) The at-fault driver carried insufficient coverage to cover the damages
d) The at-fault driver’s insurance company is insolvent

A

a) The insured was at-fault in the accident

17
Q

What is NOT payable under Uninsured Motorist coverage?

a) Loss of Consortium
b) Damage to the insured vehicle
c) Medical expenses
d) Lost wages

A

b) Damage to the insured vehicle

There is no property damage coverage under Uninsured Motorist

18
Q

Darla has $50,000 Combined Single Limit of Uninsured Motorist coverage under her policy. She is not riding in her own car, but is riding in Randy’s car. Randy has $30,000 Combined Single Limit under his policy. They get involved in a not at-fault accident. Darla suffers injuries which result in $45,000 in medical expenses. How much will the carrier pay under Darla’s Uninsured Motorist coverage?

a) $10,000
b) $15,000
c) $20,000
d) Nothing is payable unless the insured is in her own vehicle

A

b) $15,000

19
Q

The insured’s car was stolen and the thief drove the car into a tree. Is that event considered Collision or Other than Collision?

A

Other than Collision, since the first cause of loss was theft of the auto

20
Q

Flood waters pushed the insured’s Corvette, so that collided with a boulder, causing damage to the car. Is that event considered Collision or Other than Collision?

A

Other than Collision, since the first cause of loss was flood

21
Q

All of the following are considered to be Other than Collision except:

a) Flood waters flood the inside of the car
b) An animal runs into the insured’s car
c) The insured misjudges the curve and rolls the car
d) Wind damages the car

A

c) The insured misjudges the curve and rolls the car

This event is considered Collision

22
Q

The insured is driving down the road when a low-hanging branch causes $700 damaged to the windshield. He was a $100 deductible for Other than Collision and and $250 deductible for Collision. How much is payable on the windshield?

A

The full $700 is payable since no deductible applies to any windshield damage

23
Q

The insured has PAP and is involved in an auto accident. The insured’s pickup truck experienced damage to the right front fender, the camper body on the top, and to the fancy paint job on the side. What will be payable under Part D of PAP?

A

The right front fender is payable since it is a part of the vehicle.

24
Q

If the insured wants to purchase coverage to a non-owned auto when he uses the vehicle for business, the car is furnished for his regular use, or when he carries people or property for a fee, what would he purchase?

A

The Extended Non-Owned Endorsement

25
Q

If the insured wants to purchase coverage for a motor home, motorcycle, all-terrain vehicle, golf cart, or dune buggy, how can he acquire the coverage under PAP?

A

The Miscellaneous- Type Vehicle Endorsement

26
Q

Which of the following is NOT eligible for FAJUA?

a) A Florida resident
b) A non-resident owning property in Florida
c) Military non-resident in the state of Florida
d) Those who are subject to the No-Fault law

A

b) A non-resident owning property in Florida

27
Q

All are considered to be a major car part, except:

a) Air conditioning, transmission
b) Front end suspension
c) Drive axle, drive train
d) Radio antenna

A

d) Radio antenna