RMIN Ch 22 Auto Insurance questions
well answered to pass
1) Which of the following statements about the liability limits of the PAP is (are)
true?
I. The policy is written with split limits of liability.
II. Prejudgment interest is considered part of the damage award and is subject to
the policy limit of liability.
A) I only
B) II only
C) both I and II
D) neither I nor II - correct answer ✔✔C
2) Which of the following statements about the payment of defense costs by the
PAP is (are) true?
I. They are paid in addition to the policy limits.
II. They are payable even after the limit of liability is exhausted.
A) I only
B) II only
C) both I and II
D) neither I nor II - correct answer ✔✔A
3) All of the following are covered autos under the liability section of the PAP
EXCEPT
,A) a nonowned van which is driven by the insured on a regular basis.
B) a trailer owned by the named insured.
C) a borrowed auto used by the insured as a substitute for a stolen covered auto.
D) a newly acquired auto which replaces a vehicle previously described in the
policy. - correct answer ✔✔A
4) All of the following are insured persons under the liability coverage of the PAP
EXCEPT
A) a friend to whom the named insured loans a covered auto.
B) the employer of the named insured for actions resulting from the named
insuredʹs use of a covered auto.
C) the former spouse of the named insured who moved out of the home 2 years
ago when the divorce was finalized.
D) a relative of the named insured if a member of the same household. - correct
answer ✔✔C
5) Which of the following persons is (are) covered for liability insurance under the
PAP?
I. A family member who drives a covered auto.
II. A family member who occasionally drives a friendʹs auto.
A) I only
B) II only
C) both I and II
D) neither I nor II - correct answer ✔✔C
, 6) All of the following are covered as supplementary payments under the liability
section of the PAP EXCEPT
A) the cost of an appeal bond in a lawsuit.
B) the cost of a bail bond for a traffic violation when no accident is involved.
C) interest which accrues on a liability judgment covered by the policy.
D) reasonable expenses incurred by the insured to testify at a trial involving a
lawsuit covered by the policy. - correct answer ✔✔B
7) Which of the following situations would be covered by the liability section of an
unendorsed PAP if the insured is legally liable?
A) The insured injures a pedestrian while operating a friendʹs new motorcycle.
B) The insured backs into and damages the garage door of his rented house.
C) A friendʹs suitcase and laptop computer were damaged in an auto accident
while the insured and the friend were vacationing together.
D) The insured damages a parked car while driving a dump truck for his or her
employer. - correct answer ✔✔B
8) What is the purpose of the extended nonowned liability coverage endorsement
to the PAP?
A) to provide liability coverage for an insuredʹs employer when an insured uses his
or her auto for business purposes
B) to provide liability coverage for an insured who occasionally operates a
nonowned auto
C) to provide liability coverage for anyone who loans a covered auto to another
driver
D) to provide liability coverage for an insured who operates a nonowned auto on a
regular basis - correct answer ✔✔D
well answered to pass
1) Which of the following statements about the liability limits of the PAP is (are)
true?
I. The policy is written with split limits of liability.
II. Prejudgment interest is considered part of the damage award and is subject to
the policy limit of liability.
A) I only
B) II only
C) both I and II
D) neither I nor II - correct answer ✔✔C
2) Which of the following statements about the payment of defense costs by the
PAP is (are) true?
I. They are paid in addition to the policy limits.
II. They are payable even after the limit of liability is exhausted.
A) I only
B) II only
C) both I and II
D) neither I nor II - correct answer ✔✔A
3) All of the following are covered autos under the liability section of the PAP
EXCEPT
,A) a nonowned van which is driven by the insured on a regular basis.
B) a trailer owned by the named insured.
C) a borrowed auto used by the insured as a substitute for a stolen covered auto.
D) a newly acquired auto which replaces a vehicle previously described in the
policy. - correct answer ✔✔A
4) All of the following are insured persons under the liability coverage of the PAP
EXCEPT
A) a friend to whom the named insured loans a covered auto.
B) the employer of the named insured for actions resulting from the named
insuredʹs use of a covered auto.
C) the former spouse of the named insured who moved out of the home 2 years
ago when the divorce was finalized.
D) a relative of the named insured if a member of the same household. - correct
answer ✔✔C
5) Which of the following persons is (are) covered for liability insurance under the
PAP?
I. A family member who drives a covered auto.
II. A family member who occasionally drives a friendʹs auto.
A) I only
B) II only
C) both I and II
D) neither I nor II - correct answer ✔✔C
, 6) All of the following are covered as supplementary payments under the liability
section of the PAP EXCEPT
A) the cost of an appeal bond in a lawsuit.
B) the cost of a bail bond for a traffic violation when no accident is involved.
C) interest which accrues on a liability judgment covered by the policy.
D) reasonable expenses incurred by the insured to testify at a trial involving a
lawsuit covered by the policy. - correct answer ✔✔B
7) Which of the following situations would be covered by the liability section of an
unendorsed PAP if the insured is legally liable?
A) The insured injures a pedestrian while operating a friendʹs new motorcycle.
B) The insured backs into and damages the garage door of his rented house.
C) A friendʹs suitcase and laptop computer were damaged in an auto accident
while the insured and the friend were vacationing together.
D) The insured damages a parked car while driving a dump truck for his or her
employer. - correct answer ✔✔B
8) What is the purpose of the extended nonowned liability coverage endorsement
to the PAP?
A) to provide liability coverage for an insuredʹs employer when an insured uses his
or her auto for business purposes
B) to provide liability coverage for an insured who occasionally operates a
nonowned auto
C) to provide liability coverage for anyone who loans a covered auto to another
driver
D) to provide liability coverage for an insured who operates a nonowned auto on a
regular basis - correct answer ✔✔D
