10. Computing your liability - An auto insurance example What are the possible consequences of your automobile policy coverage choices? Many states mandate minimum limits for several insurance coverages, but these limits rarely provide sufficient protection for you as the insured or for others who may be affected by your actions and decisions. Many drivers have insufficient coverage-even though their limits exceed the state minimum. Consider the consequences of Jake's insurance coverage decisions below. Jake has a Personal Automobile Policy (PAP) that provides liability coverage with limits of $50/100/50, no medical payment insurance, and uninsured and underinsured motorist coverage with limits of $100/300. He has collision and comprehensive coverage, both of which have a $500 deductible. Suppose one day Jake fails to notice a red light, causing him to blindside another car crossing the intersection. Fortunately, he is not badly injured, but the medical bill for his hospital examination nonetheless amounts to $1,938. The driver of the other car, a woman named Latasha, suffered severe injuries from the direct impact of the accident, requiring an initial surgery, an extended hospital stay, and additional physical therapy procedures for several subsequent months. The total of her medical bills, plus compensation for being unable to work for nearly a month, totaled $135,947. Latasha's insurance company successfully filed a daim against Jake by exercising subrogation rights. Coverage A of lake's plan will reimburse him for of Latasha's medical bills, Jake's medical bills 50 $50,000 Jake's car was relatively unbarmed by the co quired 1,200 in minor repairs. Latasha's car was destroyed, making lake kable for paying the $10,400 replacement value. U $100,000 was pushed up onto a nearby sidewalk on impact, destroying a nearby lawn and causing additional damage to a parked 135,947 poe totaled $8,693. pryp 10. Computing your liability - An auto insurance example What are the possible consequences of your automobile policy coverage choices? Many states mandate minimum limits for several insurance coverages, but these limits rarely provide sufficient protection for you as the insured or for others who may be affected by your actions and decisions. Many drivers have insufficient coverage-even though their limits exceed the state minimum. Consider the consequences of Jake's insurance coverage decisions below. Jake has a Personal Automobile Policy (PAP) that provides liability coverage with limits of $50/100/50, no medical payment insurance, and uninsured and underinsured motorst coverage with limits of $100/300. He has collision and comprehensive coverage, both of which have a $500 deductible Suppose one day Jake fails to notice a red light, causing him to blindside another car crossing the intersection. Fortunately, he is not badly injured, but the medical bill for his hospital examination nonetheless amounts to $1,938. The driver of the other car, a woman named Latasha, suffered severe injuries from the direct impact of the accident, regoing an initial surgery, an extended hospital stay, and additional physical therapy procedures for several subsequent months. The total of ber medical bills, plus compensation for being unable to work for nearly a month, totaled $135,947. Latasha's insurance company successfully filed a claim against ake by exercising subrogation rights Coverage A of Jake's plan will reimburse him for of Latasha's medical bills. Joon's medical bills are covered under Part A are not covered by his policy Jake's car was relatively unharmed by the collision but required 1.200 in minor repairs. Latasha's car was for paying the $10,400 replacement value. Latasha's car was pushed up onto a nearby sidewalk on impact are covered under Part C Jake's car was relatively unharmed by the collision but required 1,200 in minor repairs. Latasha's car was destroyed, making Jake liable for paying the $10,400 replacement value. Latasha's car was pushed up onto a nearby sidewalk on impact, destroying a nearby lawn and causing additional damage to a parked car. This damage totaled $8,693. Jake's liability coverage also will reimburse him for up to worth of property damage. Therefore, he is responsible for paying out-of-pocket in property liability damages. Which of the following is true regarding the damage to his own car? It will be reimbursed up to the difference between his liability coverage and the damage to other property It is not covered under his policy, O it will be reimbursed fully, minus the $500 deductible. Jake's hability coverage also will reimburse him for up to worth of property damage. Therefore, he is responsible for paying out-of-pocket in property liability damages he following is true regarding the damage to his own car? $30,000 It will be reimbursed up to the difference betwe ly coverage and the damage to other property. $50,000 It is not covered under his policy. $100,000 It will be reimbursed fully, minus the $500 deductible Jake's liability coverage also will reimburse him for up to worth of property damage. Therefore, he is responsible for paying out of pocket in property liability damages. Which of the following is true regarding the damage to his own car? $0 will be reimbursed up to the difference between his liability coverage and the damage to other property $25,907 not covered under his policy $29,707 will be reimbursed fully, minus the $500 deductible