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Personal/comm. Auto
Arizona Independent Insurance Adjusters Exam
| Question | Answer |
|---|---|
| One day Tom reports to work, and Tom is instructed to deliver a load of lumber to a customer in the company truck. Tom runs a red light and causes an accident. Why might Tom's PAP liability insurance deny coverage to Tom? | Tom's accident occurred during employment related activities, and would be covered by his employer's liability. |
| Paul is driving up to the mountains. A deer sprints out in front of him. He strikes the deer causing $5,000 in damages to his automobile and causing $1,000 in injuries to himself. What insurance coverage would pay for damages to Paul's auto? | Comprehensive |
| True or FALSE: Mental distress caused by the trauma of an auto accident would not be covered by an auto liability insurance policy? | TRUE |
| Paul is driving up to the mountains. As he's driving, a deer sprints out in front of him. He strikes the deer causing $5,000 in damages to his automobile and causing $1,000 in injuries to himself. What insurance coverage might pay for injuries to Paul? | Medical Payments |
| Barb purchases an auto liability insurance policy. She examines her coverage of $100,000 for property damage, $200,000 for bodily injury to any one individual, and $400,000 for bodily injury in total. In split limits, how would this policy be expressed? | 200/400/100 |
| True or False: A driver that strikes the insured's vehicle would be covered by medical payments coverage | FALSE |
| True or False: The insured can receive indemnification for expenses incurred retrieving relevant court documents. | TRUE |
| While taking a nap, your co-worker takes your car and goes out for a spin. Would he be considered an "insured" under liability coverage? | NO |
| True or False: An insurer cancel a policy after 60 days with sufficient notice if the policyholder has their driver's license suspended or revoked. | TRUE |
| True or False: An auto finance company can force their debtor to list the finance company as a loss payee on an insurance contract to protect its insurable interest in a vehicle purchased on loan by an insured policyholder. | TRUE |
| a personal auto insurance policy, commonly known as a “____.” | PAP |
| Businesses, corporations, and organizations are not eligible for ___ policies. | PAP |
| An _____ ____ ____ ___ is designed to provide an insured party protection against their legal liability for bodily injuries and / or property losses caused to other persons as a result of automobile accidents caused by the insured. | automobile liability insurance policy |
| An auto liability policy, when combined with other forms of auto insurance coverage, becomes a package policy known as a ___ ___ __, or PAP | personal auto policy |
| ___ ___ are for individuals, their families, or similarly related people that reside together (i.e. adopted children and / or foster children) | PAP policies |
| PAP policies cover four-wheel autos, vans and trucks weighing under ____ pounds. | 10,000 |
| Generally speaking, the PAP policy will cover the named insured, immediate family members of the named insured, and anyone the insured party gives ____ to drive the car. | permission |
| PAP policies pay only for property damage and bodily injury, and the defense thereof. A PAP policy does not pay for ___ damages. | punitive |
| An insurance company is responsible to defend the insured against all ___ ____, and retains the right to settle claims out of court. | liability claims |
| A typical PAP is divided into the following sections: | Dec Pg Insuring Agmt and Defs Pt A Liability Pt B Med Payments Pt C Uninsured Motorist Pt D Coverage for Damage to Auto (Comp and Collision) PIP Coverage (Optional/Mandatory; varies by st.) Pt E Duties post Accident/Loss Pt.F Gen. Provisions End |
| If any party other than the named insured holds a financial interest in the covered vehicle, this party will often be listed on the declarations page as a “____ ____” on the vehicle. | loss payee |
| You” and “Your” refer to the named ___ on the declarations page | insured |
| In the event of a divorce, the spouse may retain coverage for up to __ days on the original policy, or until they purchase their own insurance policy, whichever comes first. | 90 |
| “We”, “Us” and “Our” will always refer to the ___ ___ providing the policy. | insurance company |
| “___ ____” includes anyone who is currently a resident in the named insured’s household and related by blood, marriage, or adoption. | Family member |
| “Owned” refers to any owned auto, or any auto leased for __ months or more under a written contract. | six |
| "___ ___ __" may refer to any activity involving the car, including repairing the vehicle, getting into the trunk, or even washing the vehicle. | The use of |
| “___” refers to someone in or upon a vehicle, getting in or out of a vehicle, or getting on or off of a vehicle. "____" can include sitting on a vehicle, and leaning upon or against the vehicle. | Occupying |
| Bodily injury does not include ___ ___ or psychological trauma. | mental distress |
| “___ ____” refers to the destruction of, or any physical injury to, a piece of tangible property. | Property damage |
| “Your covered auto”: While the insurance company will always cover the auto listed in the declarations page, liability insurance coverage follows the ___, not the automobile. Any car the insured is driving will be considered a “your covered auto.” | person |
| If the “newly acquired auto” is kept in addition to the auto(s) listed in the declarations, the insured must notify the insurer within __ days of the acquisition of the new vehicle. | 14 |
| The insurer will automatically provide comprehensive and collision for 4 days with a $___ deductible. | $500 |
| A liability policy will not pay for any bodily injury or property damages incurred by the ___ ___. | named insured |
| If the person borrowing the car also had liability insurance, that individual’s liability would be “___ ___” of the primary policy. | in excess |
| Most auto liability insurance policies describe the amount of liability coverage in a series of three split numbers called __ ___. | split limits |
| In regards to split limits, the first number is the maximum amount the insurance company will pay for ___ ____ to each individual involved in an accident | bodily injury |
| In regards to split limits, The second number is the maximum amount an insurance company will pay for bodily injury in ____, no matter how many individuals are injured in an accident | total |
| In regards to split limits, The third number indicates the maximum amount of money an insurance company will pay for physical damage to ____. | property |
| Policyholders can be held personally financially responsible for any damages ____ policy limits. | exceeding |
| The ___ ____ portion of a liability policy provides financial relief for expenses incurred by the policyholder in the event of an accident. ____ _____are separate from and not restricted by the policy’s liability limits. | supplementary payments |
| Supplementary payments can include: Up to $___ per day to the policyholder for lost wages incurred due to court-related hearings | 200 |
| Company-owned business vehicles are _____ from auto liability coverage. | Excluded |
| Medical payments coverage is a "_____" insurance coverage, meaning it will pay for the medical expenses of the insured party and other “covered persons” regardless of who was at fault in an accident. | no-fault |
| Medical payment coverage also applies when the ___ is struck as a pedestrian or as a bicyclist. | insured |
| Exclusions to Medical Payments: | Accidents involving vehicles with less than four wheels (i.e. motorcycles, golf carts) Autos rented or leased for hire Autos used without permission Commercial vehicles Vehicles used as a residence Injuries incurred under the scope of emplo |
| medical payments coverage will kick in only after PIP coverage has been fully ____. | exhausted |
| Uninsured and under-insured motorist coverage is designed to provide an insured party protection against bodily injury and / or physical damage caused by uninsured or under-insured ___. | motorists |
| An ____-_____ motorist is a motorist who does carry insurance, but does not carry enough insurance to pay for your damages. | under-insured |
| Part D is: | Coverage for Damage to Your Auto |
| What are the two types of Physical Damage coverage: | Collision and "Other than Collision" (Comprehensive) |
| _____ coverage is an insurance protection that provides indemnification for damages to your own vehicle as a result of a rollover or a collision with another car or object. | Collision |
| When a motor vehicle is totaled, collision coverage will pay for the ___ ___ ____ of the car at the time of the accident. Partial losses will be replaced / repaired with materials of like kind and quality. | actual cash value |
| Transportation expenses can be utilized __ hours after the accident until the car is repaired or returned. | 48 |
| Also known as comprehensive coverage, ___-____-____ is an insurance protection that provides indemnification for damages to your own vehicle as a result of any event other than a collision or overturn. | other-than-collision |
| Comprehensive coverage can indemnify the policyholder for damages resulting from a multitude of perils, and essentially provides "___-___" coverage for an automobile except for exclusions. | all-risks |
| Other-than-collision protects the policyholder for damages caused by: | Theft Hail Rain / Flood Wind Vandalism Explosion Earthquake Riot/Civil Unrest Falling objects Fire Bird or Animal strikes |
| Exclusions for Damage to Your Own Auto include: | normal wear and tear freezing mechanical/electrical breakdown tire damage war and nuclear war stereo equipment, unless permanently installed in the automobile (subject to policy limits, usually $1,000) |
| No- fault coverage, or ___ ____ ___ coverage, is an insurance protection wherein the policyholder is indemnified for bodily injuries only by his or her own insurance company regardless of who was at fault in an auto accident. | Personal Injury Protection (PIP) |
| PIP protection as a whole offers several advantages: | reduces the 3of insurance-related lawsuits PIP attempts to contain rising automobile insurance costs. as a first-party claim, the policyholder deals with their own insurance company. PIP coverage expedites payment of medical bills and lost wages |
| When applicable, PIP coverage is a ___ ____, and medical payments coverage pays in excess of PIP. | primary coverage |
| Part _ of the PAP policy defines the duties of the policyholder after an accident or a loss. As part of the policy agreement, the policyholder must meet an established set of responsibilities in the event of an accident or loss. | E |
| Part _ General Provisions outline a set of conditions that apply to the entire contract. | F |
| The __ ___ of a PAP includes: The United States Canada Puerto Rico | policy territory |
| The insurer will maintain the right to increase premiums immediately in the following situations: | The number, type, or use of automobiles Changes in coverage, deductibles or limits Changes in address Changes in covered persons |
| Subrogation rights DO NOT apply to Part-_ Physical Damage. | D |
| If the policyholder fails to make a premium payment, the insurer must provide __ days written notice of cancellation to the insured. | 10 |
| If the insurer elects to cancel the policy within the first __ days of the contract, the insurer must provide 10 days written notice of cancellation to the insured. | 60 |
| After 60 days, the insurer may only cancel a policy for the following reasons: | non-payment of premium misrepresentations on behalf of the insured a fraudulent claim filed by the insured the insured or a covered person under the insured has their driver’s license suspended or revoked |
| A towing and labor endorsement pays a specified limit for towing and labor charges for disabled vehicles or vehicles that have been in an accident. “___” covers only expenses realized at the location of disablement. | Labor |
| A ___ ___ ___ is designed to provide a variety of motor vehicle insurance protections to a business or commercial enterprise. | business auto policy (BAP) |
| Four different types of business auto policies: | Business Auto Policy • Garage Policy or Garage-keepers Policy • Trucker's Policy • Motor Carrier Policy |
| A business auto policy is split into the following sections: | Section I Covered Autos Section II Liability Coverage Section III Physical Damage Coverage Section IV Conditions Section V Definitions |
| The covered autos section of a business auto policy utilizes a series of numbers (called ___) to designate which particular insurance coverages apply to which insured motor vehicles. | symbols |
| Symbol #1 | Any Auto any auto literally covers any auto; it’s such broad coverage that it typically only applies to liability coverage (i.e. harm to others and their property, not loss to the insured’s property). |
| Symbol #2 | Owned Autos Only • owned autos refers to any/all motor vehicles owned by the insured during the policy period. |
| Symbol #3 | Owned Private Passenger Autos Only • covers all passenger autos, but excludes trucks, buses, specialty vehicles etc. |
| Symbol #4 | Owned Autos Other Than Passenger Autos • covers all owned autos except passenger automobiles (e.g. covers only trucks, buses, specialty vehicles etc.) |
| Symbol #5 | Owned Autos Subject to No-Fault insurance laws (some states have “no fault” laws) |
| Symbol #7 | Specifically Described Autos • a “specifically described auto” is a specific motor vehicle. For example, the declarations may list a particular bus that the business uses to ferry potential clients to a trade show. |
| Symbol #8 | Hired Autos Only • Only for autos the insured has leased, hired, rented or borrowed (but not rented or borrowed from employees) |
| Symbol #9 | Non-Owned Autos Only • non-owned auto refers to liability coverage provided on all motor vehicles not owned by the insured party. |
| The definition of “____” includes continuous or repeated exposure to the same condition that results in “bodily injury” or “property damage” | accident |
| _____ insurance is designed to offer insurance protection for those in the business of selling, servicing, repairing, parking and storing automobiles. | Garage |
Created by:
ajramirez1969
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