Paul has a personal auto policy with a per-person liability limit of $

Paul has a personal auto policy with a per-person liability limit of $300,000. He also has a personal umbrella policy with a limit of $2,000,000 and a self-insured retention of $1,000.

How much will be paid by each policy if a person wins a judgment of $500,000 against Paul as a result of bodily injury arising from the auto accident?
A) The auto policy will pay nothing, and the umbrella policy will pay $449,000.
B) The auto policy will pay $250,000, and the umbrella policy will pay $250,000.
C) The auto policy will pay $300,000, and the umbrella policy will pay $199,000.
D) The auto policy will pay $300,000, and the umbrella policy will pay $200,000.

ANSWER

Answer: D