Question
Susan has a personal auto policy (PAP) with a liability limit of $500,000. She also has a personal umbrella policy with a limit of $1
Susan has a personal auto policy (PAP) with a liability limit of $500,000. She also has a personal umbrella policy with a limit of $1 million. Susan is involved in an auto accident where she is the at-fault driver. The person Susan hit is awarded $800,000 for her liability claim against Susan and Susans insurance company spends $100,000 in legal costs associated with the claim. How much will each policy pay?
A. The Auto Policy will pay nothing, and the umbrella policy will pay the $100,000 of legal costs and the judgement of $800,000
B .The Auto Policy will pay nothing, and the umbrella policy will pay the $800,000 legal judgement but not the $100,000 of legal costs
C. The Auto Policy will pay the $100,000 of legal costs plus the $500,000 for the legal judgement, and the umbrella policy will pay the remaining $300,000 for a total amount of $900,000
D. None of the above
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