Chapter 23 RSM Exam Questions and Answers with Verified Solutions | Latest Updated 2026

Chapter 23 RSM Exam Questions and
Answers with Verified Solutions | Latest
Updated 2026



Personal liability insurance Personal liability insurance protects the
named
insured and family members against legal
liability
arising out of their personal acts. If the
insured is
found legally liable for bodily injury or
property
damage, the insurer will pay damages up
to the
policy limit and also provide legal defense.
:contentReference[oaicite:1]{index=1}


Location of personal liability Personal liability insurance is provided in
coverage in homeowners policy Section II
of the homeowners policy, which focuses
on
liability protection rather than property
coverage.
:contentReference[oaicite:2]{index=2}

, Coverage E - Personal liability Coverage E protects the insured when a
claim or
lawsuit is brought alleging bodily injury or
property
damage caused by the insured's
negligence. It is
broad in scope and based on legal liability
principles.:contentReference[oaicite:3]{ind
ex=3}


Per-occurrence limit The liability coverage under Coverage E
applies on
a per-occurrence basis, meaning the
insurer will
pay up to the policy limit for all damages
arising
out of a single occurrence.
:contentReference[oaicite:4]{index=4}


Definition of occurrence An occurrence is defined as an accident
that
results in bodily injury or property damage
during
the policy
period.:contentReference[oaicite:5]
{index=5}


Defense obligation under The insurer must provide a legal defense
Coverage for the
E insured even if the claim or lawsuit is
groundless,
false, or
fraudulent.:contentReference[oaicite:6]
{index=6}