Auto insurance policy assignment Fred has one car and has a PAP with the following coverages: Liability coverages: split limit 100/300/50 Medical payments coverage: $5000 for each person Uninsured motorists coverage: $25,000 for each person Collision loss: $250 deductible Other-than-collision loss: $100 deductible With respect to each of the following situations, determine whether the loss is covered, by which section of the policy, and how much Fred's insurer will pay. If Fred's policy does NOT cover such loss, then briefly explain why. In situations where Fred's policy may apply on an excess basis (in order words, other policies are considered primary coverages), ignore the primary coverage. Assume that each situation is a separate event. 1. Fred's son, age 16 , is driving the family car and kills a pedestrian. The heirs of the deceased pedestrian sue for $100,000. a) Circle one: Covered_(also answer part b) Not covered (also answer part c) b) If covered, by which section and how much will the insurer pay: c) If it is NOT covered by Fred's policy, explain why: 2. Fred borrows a friend's car to go to the supermarket. He fails to stop at a red light and negligently smashes into another motorist. The other driver's car, valued at $5000, is totally destroyed. In addition, damages to the friend's car are $1000. Ignore Fred's friend's insurance. The other driver's car: a) Circle one: Covered (asiso answer part b) Not covered (also answer part c) b) If covered, by which section and how much will the insurer pay: c) If it is NOT covered by Fred's policy, explain why: Damage to the friend's car: a) Circle one: Covered (also answer part b) Not covered (also answer part c) b) If covered, by which section and how much will the insurer pay: c) If it is NOT covered by Fred's policy, explain why: 3. Fred lets his best friend Mark drive the car, and Mark negligently injures another motorist. Mark is sued for $10,000. a) Circle one: Covered (also answer part b) Not covered (also answer part c) b) If covered, by which section and how much will the insurer pay: c) If it is NOT covered by Fred's policy, explain why: 4. Fred's daughter, Myra, is attending college in a different state. She is 19 years old. She drives her boyfriend's car on a regular basis. While driving the boyfriend's car, she is involved in an accident in which another motorist is injured and sues her for $5,000. Myra is at fault. a) Circle one: Covered (also answer part b) Not covered (also answer part c) b) If covered, by which section and how much will the insurer pay: c) If it is NOT covered by Fred's policy, explain why: 5. Fred is walking across a street and is struck by a motorist who fails to stop (a hit-and-run case). He has bodily injuries in the amount of $15,000. a) Circle one: Covered (also answer part b) Not covered (also answer part c) b) If covered, by which section and how much will the insurer pay: c) If it is NOT covered by Fred's policy, explain why: 6. Fred's car hits a cow crossing a highway. The cost of repairing the car is $700. a) Circle one: Covered (also answer part b) Not covered (also answer part c) b) If covered, by which section and how much will the insurer pay: c) If it is NOT covered by Fred's policy, explain why: 7. Fred's wife is driving the covered family car in a snowstorm. She loses control of the car on an icy street and smashes into the foundation of a house. The property damage to the house is $20,000. Damages to the family car are $5000. Fred's wife has medical expenses of $3000. Property damage to the house: a) Circle one: Covered (also answer part b) Not covered (also answer part c) b) If covered, by which section and how much will the insurer pay: c) If it is NOT covered by Fred's policy, explain why: Damage to the family car: d) Circle one: Covered_(also answer part b) Not covered (also answer part c) e) If covered, by which section and how much will the insurer pay: f) If it is NOT covered by Fred's policy, explain why: Medical bill of the wife: g) Circle one: Covered (also answer part b) Not covered (also answer part c) h) If covered, by which section and how much will the insurer pay: i) If it is NOT covered by Fred's policy, explain why
