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rmin 2005 exam 3 Questions and Correct
Answers
Which of the following statements is (are) true regarding auto
accidents in the U.S. Ans: all of the above
Because Y's car is broken down, Y borrows his son's car to run an
errand. The son, who lives with Y in the same household, does not
have his car insured. If Y has an accident, would Y's PAP cover
him? Explain why or why not. Ans: Yes, coverage exists on the
basis that the son's car is a temporary substitute automobile.
Elisa has a PAP with the minimum limits required in Louisiana. She
is involved in an accident that injures Sammie, the driver in the
other car. Sammie sues Elisa's insurer for $13,000 in medical bills
from the accident and wins. The next year Sammie sues the insurer
for another $5,000. Elisa and her insurer both think this is
suspicious because it is a totally unrelated injury to his original
injury. The insurer decides not to fight the suit and pays Sammie
$2,000. Which of the following would happen next if Sammie
continues to say he needs another $3,000? Ans: The insurer will
not defend Elisa or pay the $3,000 because Elisa's per person
bodily injury limits were exhausted
Tracie is a Louisiana resident who carries a PAP with the minimum
amount of insurance required in her state. Heading to visit a
friend, Tracie is driving in Arkansas where the liability minimum
requirements are $25,000/$50,000/$25,000. If Tracie has an
accident in Arkansas, that is her fault, which of the following is
true about her liability coverage? Ans: Tracie has more BI liability
(per person/per accident) but the same PD liability per accident
True or False: Both Medical Payments and Uninsured Motorist
coverage in a PAP ONLY pays if the insured is not at fault for the
accident. Ans: False
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, 2 | Page
John accidentally backs into a tree and causes significant damage
to his car Ans: Collision
Marge's car is significantly damaged by hail Ans: Other than
collision
David accidentally hits a pedestrian and is sued Ans: Liability
Katrice is in an accident that she thinks might have been her fault.
What IS one of her duties after an accident? Ans: Sending any
important legal reports about the accident to the insurer
Systems that track your driving behavior, including when you
drive, how many hard stops you have, and how often you rapidly
accelerate are commonly known as: Ans: Telematics
Under automobile rating methods, what factor below contributes
to a rate reduction? Ans: Being older than a teenager
Which of the following is NOT true of homeowners insurance and
the homeowners insurance industry Ans: Premiums tend to stay
the same every year
Which of the following is (are) true regarding today's homeowners'
policies? Ans: They are less expensive than purchasing each
included coverage separately would be
HO-4 Ans: renters
HO-3 Ans: owner occupants
HO-6 Ans: condominium unit owners
Kat has an HO 3 covering her home. The dwelling coverage
(Coverage A) limit is $250,000. She has a terrible fire with
$240,000 of damage to the home and $25,000 to the garage. How
much coverage will she have on the garage after the $240,000 has
been spent on the home? Ans: She will only have the full $25,000
© 2025 All rights reserved
rmin 2005 exam 3 Questions and Correct
Answers
Which of the following statements is (are) true regarding auto
accidents in the U.S. Ans: all of the above
Because Y's car is broken down, Y borrows his son's car to run an
errand. The son, who lives with Y in the same household, does not
have his car insured. If Y has an accident, would Y's PAP cover
him? Explain why or why not. Ans: Yes, coverage exists on the
basis that the son's car is a temporary substitute automobile.
Elisa has a PAP with the minimum limits required in Louisiana. She
is involved in an accident that injures Sammie, the driver in the
other car. Sammie sues Elisa's insurer for $13,000 in medical bills
from the accident and wins. The next year Sammie sues the insurer
for another $5,000. Elisa and her insurer both think this is
suspicious because it is a totally unrelated injury to his original
injury. The insurer decides not to fight the suit and pays Sammie
$2,000. Which of the following would happen next if Sammie
continues to say he needs another $3,000? Ans: The insurer will
not defend Elisa or pay the $3,000 because Elisa's per person
bodily injury limits were exhausted
Tracie is a Louisiana resident who carries a PAP with the minimum
amount of insurance required in her state. Heading to visit a
friend, Tracie is driving in Arkansas where the liability minimum
requirements are $25,000/$50,000/$25,000. If Tracie has an
accident in Arkansas, that is her fault, which of the following is
true about her liability coverage? Ans: Tracie has more BI liability
(per person/per accident) but the same PD liability per accident
True or False: Both Medical Payments and Uninsured Motorist
coverage in a PAP ONLY pays if the insured is not at fault for the
accident. Ans: False
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, 2 | Page
John accidentally backs into a tree and causes significant damage
to his car Ans: Collision
Marge's car is significantly damaged by hail Ans: Other than
collision
David accidentally hits a pedestrian and is sued Ans: Liability
Katrice is in an accident that she thinks might have been her fault.
What IS one of her duties after an accident? Ans: Sending any
important legal reports about the accident to the insurer
Systems that track your driving behavior, including when you
drive, how many hard stops you have, and how often you rapidly
accelerate are commonly known as: Ans: Telematics
Under automobile rating methods, what factor below contributes
to a rate reduction? Ans: Being older than a teenager
Which of the following is NOT true of homeowners insurance and
the homeowners insurance industry Ans: Premiums tend to stay
the same every year
Which of the following is (are) true regarding today's homeowners'
policies? Ans: They are less expensive than purchasing each
included coverage separately would be
HO-4 Ans: renters
HO-3 Ans: owner occupants
HO-6 Ans: condominium unit owners
Kat has an HO 3 covering her home. The dwelling coverage
(Coverage A) limit is $250,000. She has a terrible fire with
$240,000 of damage to the home and $25,000 to the garage. How
much coverage will she have on the garage after the $240,000 has
been spent on the home? Ans: She will only have the full $25,000
© 2025 All rights reserved
