Jan:I don't come with the same answer. I am having a hard time with the answer. number 6: Joe has a Personal Auto Policy with liability of 25/50/25> He hits a car with four occupants form Minnesota, all of whom are hurt. They all sue. The first sues for $20,000.00, the 2nd for $35k, the 3rd for 22k, the 4th for 18K. The car Joe hit has $8,000.00 in damage. The company spends $20,000.00 on a law firm for defense. Ignoringy any PIP or Med pay, what is the total cost to the company for Joe's claim?a) 50,000. b) 70,000 c) 78.000 d) 90,000.00 The answer is 78,000.00. Please explain.question #22. Ralph has a PAP with liability of 10/20/10, and basic PIP with a 1,000. deductible. He is running one day and is struck as a pedestrian by a car. A week later he dies. Medical bills are 3,000. and lost wages are 1,000. How much, if any will PIP pay in this claim?a)2,000. b) 2,200. c)7,000. d) 7,200. the answer is 7,200.00 please explain.Thank you
Hi AIXA.
First one:
Joe has a PAP with 25/50/25. So, the insurer will pay 25k per injured but with a maximum of 50k per ocurrence (accident). So, even the 4 injureds sue for 96k, the insurer only will pay 50k. The company (insurer) also pay for the 8k in damage and 20k in law firm defenses. Then, 50+8+20= 78k
Second one:
Ralph have a 10/20/10, basic PIP with a 1,000 deductible.
This is what he get from his insurer:
3,000 medical bills less 1000 deductible= 2000.
2000 X 80%= 1600
1000 in lost wages X 60% = 600
And finally, he gets 5000 (death benefit) when he die.
1600+600+5000= 7200
I hope you understand now.
Marcos
First one:
Joe has a PAP with 25/50/25. So, the insurer will pay 25k per injured but with a maximum of 50k per ocurrence (accident). So, even the 4 injureds sue for 96k, the insurer only will pay 50k. The company (insurer) also pay for the 8k in damage and 20k in law firm defenses. Then, 50+8+20= 78k
Second one:
Ralph have a 10/20/10, basic PIP with a 1,000 deductible.
This is what he get from his insurer:
3,000 medical bills less 1000 deductible= 2000.
2000 X 80%= 1600
1000 in lost wages X 60% = 600
And finally, he gets 5000 (death benefit) when he die.
1600+600+5000= 7200
I hope you understand now.
Marcos
Re: Exam Questions on back of manual
by Jan Bradburn- - Teaching is truly the best way of internalizing course material. It is awesome when students response to forum questions!