Alan has a PAP with the following coverages: Liabilitycoverages: $100,000/$300,000/$50,000 Medical payments coverage:$5,000 each person Uninsured motorists coverage: $25,000 eachperson Collision loss: $250 deductible
Other-than-collision loss: $100 deductible
With respect to each of the following situations, indi- catewhether the loss is covered and the amount pay- able, if any, underthe 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 suesand damages are awarded in the amount of $500,000.
b. Alan borrows a friend’s car to go to the supermar- ket. He failsto stop at a red light and negligently smashes into anothermotorist. The other driver’s car, valued at $15,000, is totallydestroyed. In addi- tion, repairs to the friend’s car are$5,000.
c. Alan’sdaughter,Heather,attendscollegeinanother state and drivesa family auto. Heather lets her boy- friend drive the car, and henegligently injures another motorist. The boyfriend is sued for$50,000.
d. Alan’s wife is driving a family car in a snowstorm. She losescontrol of the car on an icy street and smashes into the foundationof a house. The prop- erty damage to the house is $30,000. Thedamage to the family car is $8,000. Alan’s wife has medicalexpenses of $5,000.
e. Alan is walking across a street and is struck by a motorist whofails to stop. He has bodily injuries in the amount of $15,000.
f. Alan’s car is being repaired for faulty brakes. While roadtesting the car, a mechanic injures another motorist and is suedfor $50,000.
g. Alan’s car hits a cow crossing a highway. The cost ofrepairing the car is $2,500.
h. Athiefbreaksacarwindowandstealsacameraand golf clubs lockedin the car. It will cost $400 to replace the damaged window. Thestolen property is valued at $500.
i. Alan’s wife goes shopping at a supermarket. When she returns,she finds that the left rear fender has been damaged by anotherdriver who did not leave a name. The cost of repairing the car is$2,000.
j. Alan works for a construction company. While driv- ing alarge cement truck, he negligently injures another motorist. Theinjured motorist sues Alan for $25,000.
k. Alan’s son drives a family car on a date. He gets drunk, sohis girlfriend drives him home. The girl- friend negligentlyinjures another motorist, who has bodily injuries in the amount of$200,000.
l. Compact discs (CDs) valued at $500 are stolen from Alan’scar. The car was locked when the theft occurred. m. While driving arented golf cart, Alan accidentally injures another golfer with thecart.
