Casualty Insurance Policies and Terms Flashcard

Front

What does Bodily Injury Liability cover?

Back

Medical bills, lost wages, and pain-and-suffering of other people injured in a crash

Answer explanation

Bodily Injury Liability covers the medical bills, lost wages, and pain-and-suffering of other people injured in a crash, not your own expenses or property damage.

Front

Which type of coverage pays to repair or replace others’ property when you’re at fault?

Back

Property Damage Liability

Answer explanation

Property Damage Liability coverage pays for repairs or replacement of others' property when you are at fault in an accident. This is distinct from Bodily Injury Liability, which covers injuries to others.

Front

What is the purpose of Split Limits in an auto insurance policy?

Back

To separate coverage into per-person BI, per-accident BI, and per-accident PD limits

Answer explanation

Split Limits in an auto insurance policy separate coverage into specific amounts: per-person bodily injury (BI), per-accident BI, and per-accident property damage (PD) limits, ensuring clear liability coverage.

Front

What does a Combined Single Limit (CSL) policy provide?

Back

One pool of liability money that covers both bodily injury and property damage

Answer explanation

A Combined Single Limit (CSL) policy provides one pool of liability money that covers both bodily injury and property damage, simplifying claims and coverage limits compared to separate policies.

Front

What does Medical Payments (MedPay) coverage reimburse?

Back

Medical and funeral expenses for you and your passengers, regardless of fault

Answer explanation

Medical Payments (MedPay) coverage reimburses medical and funeral expenses for you and your passengers, regardless of fault, making it essential for covering immediate medical costs after an accident.

Front

Which type of coverage pays for loss or damage to your own vehicle?

Back

Physical Damage

Answer explanation

Physical Damage coverage pays for loss or damage to your own vehicle, unlike the other options which cover liabilities or damages to others.

Front

What is covered under Other Than Collision (Comprehensive) coverage?

Back

Theft, fire, vandalism, falling objects, flood, or animal strikes

Answer explanation

Other Than Collision (Comprehensive) coverage includes protection against non-collision incidents such as theft, fire, vandalism, falling objects, flood, or animal strikes, making it the correct choice.

Front

What does Uninsured Motorist (UM) coverage provide?

Back

Coverage when the at-fault driver has no liability insurance or cannot be identified

Answer explanation

Uninsured Motorist (UM) coverage protects you when the at-fault driver lacks liability insurance or cannot be identified, ensuring you are compensated for damages or injuries resulting from such incidents.

Front

What is the role of Underinsured Motorist (UIM) coverage?

Back

To cover the difference when the at-fault driver’s liability limits are too low

Answer explanation

Underinsured Motorist (UIM) coverage helps cover the difference when the at-fault driver's liability limits are too low to fully pay for damages, ensuring you receive adequate compensation for your losses.

Front

Who is considered an 'insured' under a personal auto policy?

Back

Named insured, resident spouse and family members, permissive drivers, passengers, and personal representatives

Answer explanation

The correct choice includes the named insured, their resident spouse, family members, permissive drivers, passengers, and personal representatives, all of whom are covered under a personal auto policy.