FI 341 Chapter 23: AI and Society Flashcards
Compulsory Insurance Law
Requires motorists to carry at least a minimum amount of liability insurance before the vehicle can be licensed or registered
Unsatisfied Judgment Funds
Compensates auto accident victims who have exhausted all other means of recovery
Low-Cost Auto Insurance
Provides minimum amounts of liability insurance at reduced rates to motorists who cannot afford regular insurance
“No pay, no play” Laws
Prohibit uninsured motorists from suing negligent drivers for noneconomic damages
No-Fault Auto Insurance
No requirement to sue a negligent driver to collect; Added by endorsement to PAP
Pure No-Fault Plan
Accident victims cannot sue at all, regardless of the amount of the claim
Modified No-Fault Plan
Victims have a limited right to sue
Add-On Plan
Pays benefits to an accident victim without regard to fault; the injured person has the right to sue the negligent driver who cased the accident; Not a true no-fault plan
Choice No-Fault Plan
Motorists can elect to be covered under the state’s no-fault law and pay lower premiums OR they can retain the right to sue under the tort liability system and pay higher premiums
Optional No-Fault Benefits
In some states, insurers must also offer additional prescribed minimums (medical expenses, loss of earnings, funeral expenses, survivors’ loss benefits, essential services expenses like housework, etc.)
Shared (Residual) Market
Market for high-risk drivers who have difficulty obtaining auto insurance in the voluntary market; Typically younger drivers, drivers with poor driving records, and drivers with convictions for drunk driving
Auto Insurance Plan (Assigned Risk Plan)
Makes auto insurance available to motorists who are unable to obtain insurance in the voluntary market
Joint Underwriting Association (JUA)
Auto insurers in the state participate in providing coverage to high-risk drivers through a common pool
Reinsurance Facility (or Pool)
Places high-risk drivers
Maryland Automobile Insurance Fund
A state fund that provides insurance to high-risk drivers who have been canceled or refused insurance by private insurers
