5. Computing your liability - An auto insurance example Although car insurance is legally required by all states, the coverage provided by different policies can vary dramatically, such that even an "Insured" motorist can end up paying large amounts of money out-of-pocket. Consider the following example involving Nick, who has a family auto policy (FAP) that provides liability coverage with limits of 15/30/15, no medical payment Insurance, and uninsured and underinsured motorist coverage with limits of 1/2. He has collision and comprehensive auto insurance, both with a deductible of $100. Suppose one day Nick rear-ends a truck when it stops while he is looking down at his radio. Fortunately, he is not badly injured, but the medical bill for his hospital examination nonetheless amounts to $484. The driver of the truck, a woman named Bette, was unharmed but nonetheless required a hospital examination costing $864. Bette's Insurance company successfully filed a claim against Nick, exercising subrogation rights. Coverage A of Nick's plan will reimburse him with $0 for Bette's medical bills. Nick's medical bills are covered under coverage A Nick's car required only a new bumper, costing $584 to replace. Bette's truck required $3,650 in repairs, and its trailer contained a racehorse valued at $18,000 that fell and broke its legs upon the impact. Nick is therefore liable for the full value of the horse. out-of-pocket Nick's liability coverage also will reimburse him for up to $ in property damage, so he is responsible for paying in property liability damages. Which of the following is true regarding the damage to his own car? It will be rembursed fully, minus the $100 deductible. It is not covered under his policy. It will be relmbursed up to the difference between his liability coverage and the damage to other property