WEBCE REGULATION OF AUTO INSURANCE EXAM QUESTIONS AND ANSWERS WITH COMPLETE SOLUTIONS

WEBCE REGULATION OF AUTO INSURANCE EXAM QUESTIONS AND ANSWERS WITH COMPLETE SOLUTIONS Leave the first rating personal auto insurance policy term length typically six months or one year cancellation conditions under PAP *3 1. the name insured can cancel the policy during the policy period and insurer must return unearned premium 2. insurer has right to cancel policy is insured fails to pay premium or within first 60 days. Insurer must give insured 10 days notice for nonpayment but 20 days if other reason 3. if after 60 days, nonpayment of premium, driver's license of insured is revoke, or policy was obtained through misrepresentation nonrenewal - the PAP requires insurer to notify the named insured at least 20 days before policy expires -if policy has been in force for less than 6 months, the insurer can nonrenew only after the first 6 months - if 6 months or longer but less than one year, insurer can nonrenew only at end of first year - if policy has been in force for over a year, insurer can nonrenew at anniversary of effective date grace period the PAP does not offer a grace period for payment of the premium automatic termination if insurer renews, and named insured rejects with not paying premium, the policy terminates notice the insurer can deliver the notice of termination in person rather than mailing it premium refunds when a policy is canceled before its expiration date, the insurer must refund any unearned premium compulsory insurance laws require a motorist to have proof of financial responsibility as a condition of registering the auto, however , it is only a minimum amount of liability insurance and some people do not register their vehicles uninsured motorists coverage protects insureds from financially irresponsible drivers who do not have auto liability insurance and cannot pay anyone they injure through their negligence in an accident underinsured motorists protects against bodily injury - and in some states property damage- suffered by an insured in an accident caused by a driver who is not suffiently insured uninsured vs underinsured uninsured motorist: -the at-fault motorist is not insured - the at-fault motorist has coverage limits less than the amounts required by law -the at-fault motorist's insurer denies coverage - the at-fault motorist's insurer refuses to admit coverage except conditionally - the accident involves a hit-and-run underinsured: the at fault party's limit of liability is less than the limit of UIM or the damager are more than the at fault party's limit of liability no fault auto insurance reduces the post of auto liability coverage, bodily injury liability, and related litigation costs - reimburse for bodily injury, loss of income, loss of household serivces, funeral expenses but not property damage compulsory no-fault states nine states - defines the limits on an injudred party's right to sue under tort law and the point which the right is no longer restrcited - verbal threshold: seriousness of injury - monetary threshold: the amount of medical costs incurred from the injury choice no fault a policyholder who chooses no-fault pays a lower premium but has limited rights to recvoer under tort law for certain types of auto injuries a policyholder who does not choose no-fault coverage pays a higher premium but retains all rights to seek compensation