Which of the following statements is (are) true with respect to the collision damage waiver on rented cars? I. It is inexpensive and is provided at no charge by most rental car companies. II. It waives the renter’s liability for bodily injury liability arising out of use of the rented auto. A) I only B) […]
Date: September 19th, 2020
The purpose of gap insurance is to A) pay the difference between the bodily injury liability limit purchased and the actual amount of bodily injury liability if it exceeds the limit. B) pay the difference between the amount the insurer pays if a car is a total loss and the remaining amount owed on a […]
Date: September 19th, 2020
Duties of an insured after a collision loss covered under the PAP include which of the following? I. Take reasonable steps to protect the vehicle from further damage. II. Admit fault if the insured believes he or she caused the collision. A) I only B) II only C) both I and II D) neither I […]
Date: September 19th, 2020
The present value of $1,000 to be received in 5 years is ________ if the discount rate is 12.78%. A) $368 B) $687 C) $494 D) $548 ANSWER D
Date: September 19th, 2020
All of the following statements about the termination provisions of the PAP are true EXCEPT A) The insured can cancel the policy for any reason. B) The insurer can cancel a newly-written policy if it has been in force for fewer than 60 days. C) The insurer can cancel the policy after it has been […]
Date: September 19th, 2020
Sarah purchased a Personal Auto Policy with liability limits of 50/100/25. Sarah ran a stop sign and hit a van. The van sustained $15,000 in damages. The following bodily injuries were suffered by passengers in the van: Passenger #1, $15,000; Passenger #2, $60,000; and Passenger #3, $10,000. Sarah sustained $5,000 in medical expenses, and Sarah’s […]
Date: September 19th, 2020
U.S. Savings Bonds are sold at a discount. The face value of the bond represents its value on its future maturity date. Therefore, A) the current price of a $50 face value bond that matures in 10 years will be greater than the current price of a $50 face value bond that matures in 5 […]
Date: September 19th, 2020
The insurance company’s options for settling a collision loss to a covered auto under the PAP include which of the following? I. Pay the loss in money. II. Repair or replace the damaged auto. A) I only B) II only C) both I and II D) neither I nor II ANSWER Answer: C
Date: September 19th, 2020
In addition to providing coverage in the United States, its territories and possessions, and Puerto Rico, where else does the PAP provide coverage? A) in Mexico B) in Canada C) in both Mexico and Canada D) anywhere in the world ANSWER Answer: B
Date: September 19th, 2020
All of the following losses are excluded under Part D (coverage for damage to your auto) of an unendorsed PAP EXCEPT A) vandals damaged a portable cell phone kept in the car. B) theft of a compact disc player which was permanently installed in the auto. C) damage caused to a car’s engine because the […]
Date: September 19th, 2020
