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1.James was injured in an auto accident. The driver of the other car was at-fault. James is entitled to $100,000.00 for his injuries. In which of the following situations would James’s UNDERINSURED MOTORIST coverage applies to this accident?
The at-fault driver was a hit-and-run driver and was never found.
The driver of the other car had no auto insurance at the time of the accident.
The driver of the other car had insurance, but his Bodily Injury Limit is only $50,000.
The driver of the other car has adequate limits, but the insurer is insolvent.
2.Which of the flowing is an argument often cited by those who favor no-fault insurance?
No-fault laws increase the amount of premium percentages that benefit the insured.
No- fault laws have resulted in significant increases in auto insurance costs.
No-fault laws more fairly allocate costs to the drivers who are responsible for causing accidents.
No-fault benefits always compensate accident victims for the economic value of pain and suffering.
3.Which of the following best describes a loss that is covered as “other than collision loss” under part D of the Personal Auto Policy:
A driver hits another vehicle while swerving to miss a horse and rider.
A driver strikes a concrete barrier because another auto forced him off the road.
A driver throws open his car door in a grocery store parking lot and damages the door by striking a shopping cart.
A driver strikes a deer on a rural road and damages his car
- The part of the policy that lists the address of the named insured is called:
a.declarations page
b.insuring agreement
c.endorsements
d.conditions
- You purchase a new car and need to add physical damage coverage to your policy. The car currently listed on your current policy is a 25-year-old junk heap, Yugo, so you did not purchase comprehensive or collision coverage for this thing. Because you are now buying a “real car,” you need to add physical damage coverage as soon as possible. How many days would your existing policy provide physical damage coverage if you had an accident before you could contact your agent or company?
There is no automatic coverage for something not already listed on the policy
You have four days.
You have thirty days.
You have ten days with a $250. Deductible.
- To reduce the premium for her auto policy, Joanne increased the amount of her deductible. Increasing the deductible represents which one of the following risk management techniques:
retention
noninsurance transfer
avoidance
loss control
- When a high-risk driver applies for auto insurance, the application is sent to a central clearinghouse, and then assigned to an auto insurance company based on its overall percentage of auto insurance premium volume written in that particular state, the type of residual market is referred to as:
A specialty insurance company
An assigned risk plan
A Progressive policy
An Allstate option
Sample Solution
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