1. Biff and his girlfriend Muffy take a vacation in Muffy’s Toyota Prius because
ID: 3363947 • Letter: 1
Question
1. Biff and his girlfriend Muffy take a vacation in Muffy’s Toyota Prius because it gets far better mileage than Biff’s Cadillac. Since Muffy provides the car, Biff agrees to pay Muffy $100 to help offset the cost of fuel and other expenses. During the vacation, Muffy misses a stop sign and causes an accident in which another vehicle is damaged and Biff is injured. Which of the following statements concerning this situation under Muffy’s PAP is (are) correct?
I. Muffy’s policy provides no liability coverage because she is carrying a passenger for a fee.
II. Biff is eligible to receive medical payments under Muffy’s policy.
A. I only
B. II only
C. Both I and II
D. Neither I nor II
2. Which of the following statements concerning the uninsured motorists coverage in a PAP is (are) correct?
I. Only motor vehicles for which no bodily injury liability insurance coverage applies at the time of the accident are defined as insured vehicles.
II. The coverage applies only if the uninsured motorist is legally liable.
A. I only
B. II only
C. Both I and II
D. Neither I nor II
Explanation / Answer
1) option b (ii only) as Biff is eligible to receive medical payments under Muffy’s policy i.e. if the insured is a passenger in a car or riding public transportation, or was simply walking, and is injured by a motor vehicle, he/she will be covered
2) Option c i.e. both 1 and 2 are correct i.e uninsured should be legally liable and only motor vehicles for which no bodily injury liability insurance coverage applies at the time of the accident are defined as insured vehicles.
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