Principles of Risk Management and Insurance (13th Edition), Chapter 20, Problem 1AQ, there is no solution, can you make one?
Alan has a PAP with the following coverages:
Liability coverages: $100,000/$300,000/$50,000
Medical payments coverage: $5,000 each person
Uninsured motorists coverage: $25,000 each person
Collision loss: $250 deductible
Other-than-collision loss: $100 deductible
With respect to each of the following situations, indicate whether the loss is covered and the amount payable, if any, under the policy. Assume that each situation is a separate event.
A. Alan's son, age 16, is driving a family car, runs a red light, and kills a pedestrian. The family of the deceased pedestrian sues and damages are awarded in the amount of $500,000.
B. Alan works for a construction company. While driving a large cement truck, he negligently injures another motorist. The injured motorist sues Alan for $25,000.
C. Alan borrows a friend's car to go to the supermarket. He fails to stop at a ed light and negligently smashes into another motorist. The other driver's car, valued at $15,000, is totally destroyed. In addition, repairs to the friend's car are $5,000.
D. Alan's daughter, Heather, attends college in another state and drives a family auto. Heather lets her boyfriend drive the car, and he negligently injures another motorist. The boyfriend is sued for $50,000.
E. Alan's wife is driving a family car in a snowstorm. She loses control of the car on an icy street and smashes into the foundation of a house. The property damage to the house is $30,000. The damage to the family car is $8,000. Alan's wife has medical expenses of $5,000.
F. Alan is walking across a street and is struck by a motorist who fails to stop. He has bodily injuries in the amount of $15,000.
G. Alan's car is being repaired for faulty brakes. While road testing the car, a mechanic injures another motorist and is sued for $50,000.
H. Alan's car hits a cow crossing a highway. The cost of repairing the car is $2,500.
I. A thief breaks a car window and steals a camera and golf clubs locked in the car. It will cost $400 to replace the damaged window. The stolen property is valued at $500
J. Alan's wife goes shopping at the supermarket. When she returns, she finds that the left rear fender has been damaged by another driver who did not leave a name. The cost of repairing the car is $2,000.