Clarification Please
by Joyce Perkins - Practice Question
Joe has a Personal Auto Policy with two cars and UM limits of 25/50 stacked.
He also has basic PIP and $1000 Med Pay. He is involved in an accident where a hit and run drivers runs into his car. He has $42000 in medical bills. How much would his UM pay?
Correct answer is $31000 How is this calculated?
Re: Clarification Please
by Jan Bradburn- - Hi Joyce,
Joe's PIP will pay first and it will cover $10,000. Med Pay will pay $1,000. This leaves $31,000. Joe has 25/50 stacked UM on two vehicles. This means he has 50/100 coverage per vehicle. Since Joe has $50,000 UM coverage available, UM will pay the remaining $31,000.
Jan
Re: Clarification Please
by Joyce Perkins - Thank you Jan. I thought the PIP 10/20/10 then the UM was also 10/20/10, is this not correct?
Re: Clarification Please
by Jan Bradburn- - Joyce,
Liability insurance has split limits, i.e. 10/20/10. UM can be any amount equal or lower than the liability on the policy. In this question the UM coverage is 25/50 so we can assume the liability coverage on the policy is at least 25/50/25. PIP has a basic limit of $10,000. PIP limits are shown as asingle dollar amount - not as split limts.
Jan