15) Karen is the named insured under a PAP that provides coverage for bodily inj
ID: 2772309 • Letter: 1
Question
15) Karen is the named insured under a PAP that provides coverage for bodily injury and property damage liability, medical payments, and uninsured motorists coverage. For each of the following situations, briefly explain whether the claim is covered by Karen’s PAP.
a. Karen ran into a telephone pole and submitted a medical expense claim for Jason, a passenger in
Karen’s car at the time of the accident.
b. Karen allowed Scott to use her car. While operating Karen’s car, Scott damaged Gray’s car in an accident caused by Scott’s negligence. Karen is sued by Gray for damages.
c. Karen’s husband ran over a bicycle while driving a friend’s car. The owner of the bicycle demands that Karen’s husband pay for the damage.
d. In a fit of anger, Karen deliberately ran over the wagon of a neighbor’s child that had been left in
Karen’s driveway after repeated requests that the wagon be left elsewhere. The child’s parents seek
reimbursement.
Explanation / Answer
Answer:a.Since Jason is a passenger in a covered auto, his medical expenses would be covered under Karen’s PAP.
Answer:b Scott is covered for the property damage to Gray’s car. Any person using a covered auto is covered under the named insured’s policy if there is a reasonable belief that permission to use the automobile exists. Karen is also covered under her PAP for the suit.
Answer:c The spouse of the named insured is covered under the PAP. Thus the husband is insured under Karen’s policy. The liability coverage also extends to the occasional use of a non-owned automobile. However, the liability insurance on the friend’s car would apply first, and Karen’s insurance is excess. Thus if the husband is legally liable for damage to the bicycle, the friend’s policy would pay the claim. If the friend has no liability insurance, then Karen’s policy is primary and would pay the claim.
Answer:d Not covered. Intentional property damage or bodily injury is excluded under the PAP.
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