Ins Exam I - Auto Ins -Personal Auto Policy (PAP) Flashcards by Mee-Thlen Moy

Property

- Personal Auto Policy (PAP)

Covers loss to vehicle by:

Collision
Other than Collision

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Casualty

- Personal Auto Policy (PAP)

Covers protection from financial loss due to a negligent act of the insured arising out of the:

Ownership
Maintenance
Use of an insured motor vehicle

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Supplemental Payments to Others

- Personal Auto Policy (PAP)

Prorata
Duties after a loss (4ps)
Auto Ins Plans

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OWNED

- Covered Autos

insured's vehicle listed on policy dec 
incls the following provided no other insurance and the vehicle has a gross vehicle weight (GVW) of 10,000lbs or less. 
 - Private passenger auto 
 - Trucks 
 - Vans 
 - Newly acquired vehicles

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NONOWNED

- Covered Autos

driven by the insured but not owned by the insured

rented vehicles
temp substitute vehicles (ie: auto used while owned auto being repaired)

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TRAILERS

- Covered Autos

that are hitched to an insured vehicle - covered for liability

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Additional Vehicles *

- Newly Acquired Vehicles

Automatic cvrg provided: 14 days 4 days
Type of cvrg applied to vehicle:
- broadest cvrg shown for any vehicle listed on the policy dec
- $500 Ded
Notify Insurer to add vehicle to policy: w/in 14 days w/in 4 days

Physical damge cvrg incl (collision/comp) on insured’s existing policy
No physical damge cvrg incld

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Replacement Vehicles *

- Newly Acquired Vehicles

if new vehicle replaces an existing vehicle, the same coverage would apply to the new vehicle as were on the car it replaced.

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PERSONS INSURED

= Named insured (in the declarations) and resident spouse
- *Resident spouse automatically covered even if not specifically listed
- Non-resident spouse has coverage until the earlier of the 90 days, the effective date of another policy, or the end of the policy term
= Relative living household - family members (blood, marriage, adoption, or foster children

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PERSONAL AUTO POLICY (PAP) DEFINITIONS

Bodily Injury - bodily harm, sickness, disease, death
Property damage - physical damage, destruction, or loss of use of tangible property
OCCUPY VEHICLE - in or on the auto; or getting on, out of, or off the auto

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SPLIT LIMITS

- Part A: Bodily Injury Liability

100/300/50

three #s are used on your ins policy to describe the amount of liab cvrg you are carrying
- $100k BI per person
- $300k BI per accident
- $50k PD (owned by others)
for which any covrd person becomes LEGALLY RESPONSIBLE b/c of an auto accident, including any prejudgment interest awarded against the insured

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COMBINED SINGLE LIMIT (CSL)

- Part A: Bodily Injury Liability

Single limit amount that can be used as needed for either property damage or BI

BI - per person and PD (OWNED BY OTHERS) (not cvred insureds)
BI per accident
for which any covrd person becomes LEGALLY RESPONSIBLE b/c of an auto accident, including any prejudgment interest awarded against the insured

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Part A: Property Damage Liability

pays damage to the property of others, including govrnmnt prop, caused by the insured, such as:

damage to another vehicle
damage to a building
damage to a wall or fence.

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Supplementary Payments (Bailed)

Paid in addition to liability limits (continued)

Interest - interests on judgements while in appeal
LOSS OF EARNINGS - up to a certain limit per day for loss of insured’s earnings only be/c of attendance @ hearings or trials - $200

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Part B: Medical Payments Coverage*

Covers reasonable medical expenses for insured persons caused by an accident involving any motor vehicle designed for highway use; incls when occupying a vehicle or struck as a pedestrian
- TIME LIMITS VARIES BY STATE (TYPICALLY 1-3 YRS)

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PART C: UNINSURED AND UNDERINSURED MOTORISTS COVERAGE (UM/ UIM) 1

UM: Covers insured when other drive is w/o ins
UIM: Covers insured when other driver is w/o sufficient ins
Covers BI sustained by insured
Applies when other driver at-fault

(Covers BI caused by negligent driver who does not carry insured or not enough)

PART C: UNINSURED AND UNDERINSURED MOTORISTS COVERAGE (UM/UIM) 2

Uninsured vehicle covrg incls hit-and-run vehicles whose operator or owner cannot be IDd (ie: phantom driver hits or forces insured off the road)
UM/UIM rejection form - insured must sign in applicable states when covrg is reduced below BI limits or is completely rejected

(UM/UIM motorist on test a lot)

PART C: UNDERINSURED MOTORIST COVERAGE (UIM)

UIM fills the gaps that may exist between what the negligent underinsured driver’s BI limits are and what the injured is legally entitled to recover
the max $$$ paid is the difference between the 2 limits

Part D: Physical Damage Coverage *

Covrg provided for damage to your auto
Summary of covrgs
- Collision
- Other than collision
- Transportation expenses
- Towing and labor

PART D: COLLISION

Covers the insured vehicle or a non-owned vehicle
- Collision w/ another vehicle or object
- Upset of the vehicle (overturned vehicle)
Specified perils (collision and upset)
Deductible is common (generally higher)

PART D: OTHER THAN COLLISION (COMPREHENSIVE)

Covers any direct and accidental damage to the vehicle other than collision

Covers the insured vehicle or a non-owned vehicle
Open peril - everything covered unless excl
Deductible is common (generally higher)

PART D: OTHER than COLLISION COMMON PERILS

Fire - Hail
Theft - Flood
Explosion - Vandalism
Earthquake - Glass Breakage
Wind - Falling Objects
Contact w/ Birds/Animals

Part D: Transportation Coverage *

Expenses paid to an insured in the event of a covrd loss for substitute transportation

Covrg applies to both collision and other than collision losses
NO DEDUCTIBLE
Covers rental costs of a substitute vehicle
for Theft losses, there is a 48hr waiting period
- the theft must be reported to the police and the insurer
for Other losses, there is a 24hr waiting period
USUALLY LMTD TO $20 PER DAY, UP TO A MAX OF $600

Part D: Limits of Liability Paid for Physical Damage*

in the event of a covrd loss, the insurer’s liab is lmtd to the lesser of

the ACTUAL CASH VALUE (ACV) OF THE VEHICLE
the AMOUNT NEC TO REPAIR OR REPLACE W/ PROP OF THE LIKE KIND and QUALITY

Part D: Physical Damage Exclusion*

some of the most common exclusions incl - Sound equipmnt unless permanently installed - CBs, Computers, VCRs, TVs, etc - Awnings and cabanas designed to create living facilities - Customized equipment - War - Wear & Tear - Road Damage to Tires - Mechanical or electrical breakdown or failure - Freezing

Towing and Labor*

- Optional Coverage added by Endt | - Towing and roadside assistance

Part E: Duties Following a Loss*

- Cooperate w/ insurer - Notify police if hit-and-run - Protect damaged property - Prompt Notice of loss to insurer - Permit insurer to inspect and APPRAISE damaged prop before it is repaired or replaced - Notify policy promptly if vehicle is stolen

Part F: General Provisions*

- Inception of cvrg - 12:01AM - Territory = U.S., its territories and possessions, Puerto Rico, Canada - No coverage in Mexico (PQ) - Assignment - may not be assigned w/o insurer's written consent - Termination - insurer must give notice (20 Days), NR (45 Days)

Auto Repair Claims Settlement | - Claims Loss Settlement

Auto claims settled @ ACV, and insurer will - Total the vehicle when repair costs exceed vehicle value - Repair when repair cost is less than vehicle value - Replace when insurer can find another vehicle of like kind and quality

APPRAISAL | - Claims Loss Settlement

Settlement option regarding value of loss disputes - insurer and insured each select an appraiser - ea party pays costs of its own appraiser - 2 appraisers than select an umpire - costs of umpire split between 2 parties - Amount agreed upon by 2 out of the 3 is amount paid of the loss

ARBITRATION | - Claims Loss Settlement

- Arbitration - worded similarly to the appraisal condition, but is not lmtd to disputes over the value of the loss - Can be applicable when insurer and insured do NOT AGREE - whether insured is legally entitled to recover damages - or as to the amount of damages recoverable - Typically listed in the part of the policy where uninsured motorist covrg is addressed

EXTENDED NON-OWNED COVERAGE FOR NAMED INDIVIDUAL | - Selected PAP Endts

- used to extend the drive other car coverage of the PAP is incl cvrg for all the excl types of non-owned autos expect those used in the garage business - covrg applies to indiv named in the endt - A/P required

- JOINT OWNERSHIP COVERAGE - Towing and Labor Coverage - Selected PAP Endts

provides covrg for the interests of ea owner of a cvrd auto - -------------------------------------------------------------------------------- - Pays for towing costs and labor performed @ the scene or place of disablement (labor must be preformed @ the place of disablmnt) - Cost of replacement materials not covered - A/P required

- MISCELLANEOUS TYPE VEHICLES - Amendment of Policy Provisions - Selected PAP Endts

- Provides covrg for VEHICLES NOT OF THE STANDARD FOUR-WHEELED TYPE, such as motorhomes, motorcycles, scooters, all terrain vehicles, etc. - Provides BI, uninsured motorist, PD, and medical pymnts - -------------------------------------------------------------------------------- - Amends the PAP to meet various state requrmnts

AUTOMOBILE INSURANCE PLANS (AIP)

Also known as ASSIGNED RISK PLANS; operated by the state - Used when driver is refused in standard mrkt - Pool incls all admitted insurers in state - Notice of eligibility must be provided to insured if terminated by insurer PQ: program designates Ins Co

In MA every motor vehicle liability ins policy must provide PI benefits for medical expenses in an amount not to exceed what amount?

$8,000