CPCU 553 Chapter 3 Exam Questions and Answers | Verified & Updated | 100% Correct

CPCU 553 Chapter 3 Exam Questions and Answers | Verified & Updated | 100% Correct Larry drove his car and was involved in a two-car accident caused by the other driver, who was uninsured. The at-fault driver offered Larry a substantial amount of money in satisfaction of his damages. Larry accepted the money in settlement of his losses and released the other driver from further liability. Larry later submitted an uninsured motorists claim under his Personal Auto Policy (PAP). The uninsured motorists claim would be - Answer ️️ -Denied because coverage under these circumstances is excluded. Jared had a Personal Auto Policy (PAP) with a single limit of $100,000 for bodily injury and property damage liability. He was found to be at fault for an accident by a court and a $95,000 judgment was entered against him. In addition, prejudgment interest of $10,000 was awarded. Since entry of judgment, $1,000 in postjudgment interest has accrued. Jared earns $150 a day in salary and missed five days of work to attend the trial. His insurer spent $25,000 defending the lawsuit against Jared. What is the total that should be paid by Jared's insurer under his PAP? - Answer ️️ -$126,750 = $95,000 (judgment) + $5,000 (prejudment interest of $10,000, but subject to limit of liability of $100,000) + $1,000 (postjudgment interest is a supplementary payment) + $750 (loss of earnings because of attendance at trial up to $200 a day) + $25,000 (defense costs).