Question

1. Jane has a PAP with the following coverages:

Liability coverages: $250,000/$500,000/$100,000

Medical Payments coverage: $10,000 each person

Uninsured motorists coverage (bodily injury only): $50,000 each person

Collision loss: $2,500 deductible

Other-than-collision loss: $250 deductible

With respect to each of the following situations (5 points each), please indicate whether the loss is covered (yes/no & which section) and the amount payable, if any, under the policy. Assume that each situation is a separate event (I am not looking for cumulative math across all problems).

1. Jane’s son, age 17, is driving a family car and causes a multi-car accident. Jane’s son is sued and a jury awards the three victims $250,000 each for bodily injuries.

2. Jane is walking across a street and is struck by a motorist in the intersection. She has bodily injuries in the amount of $7,500.

3. Jane’s husband is driving a family car in an ice storm. He loses control of the car and smashes into a neighbor’s house. The property damage to the house is $150,000. The neighbor files a property damage lawsuit against Jane’s husband for recovery.

4. Jane’s other son, age 21, attends college in West Hartford. During a party, someone throws a beer bottle out of a dorm. It strikes Jane’s car, cracks the windshield, and causes $2,000 in first-party property damage.

Answer 1

Ans 1 : Yes upto the limits specified below & will be covered under Liability Coverage

Explanation:In this PAP, Liablility Coverage is a Split Limit i.e $250K/$500K/$100K(Limit per person/Total Limit/ Property Damage). Since Jane Son is sued and jury has awarded $250K per person. Therefore,

2 victims will get full $250k/each from the policy

1 Victim will be paid from Jane's family personal finances(As It has breached the claim of $500K in the Total Limit)

Ans 2: Yes will be covered in full($ 7500) under Medical Payment Coverage

Explanation: Medical Payment Clause covers claims if the insured is a passenger in a car/ or was simply walking and got injured by a vehicle.

Ans 3: Yes upto $ 100K under Liability Coverage

Explanation: As per the Split limit under the Liability Coverage(Limit per person/Total Limit/Property Damage).

$100K would be covered from PAP

$50K from Jane's Family personal Finances

Ans 4: Yes it will be covered under other than Collision Loss subject to deductible of $250.

Explanation: It is a claim under other than collision and claim admissible is $2000-$250= $1750

Thanks!