Final answer:
In the scenario described, Betty must first use her own PIP to pay for her medical bills as PIP is designed to cover the policyholder's medical expenses, regardless of fault. Sam does not have tort exemption and thus could be liable for damages. Specific outcomes may vary based on state laws and insurance policy details.Option C is the correct answer.
Step-by-step explanation:
The question pertains to the handling of medical bills post an at-fault vehicle accident where Personal Injury Protection (PIP) insurance is involved.
Given the scenario:
- Sam is an owner and not insured for PIP.
- Sam borrows Fred's car, which is insured for PIP.
- Sam has an at-fault accident when he strikes Betty's car.
- Betty is insured for PIP.
- As a result, Betty is injured and has $5,000 in medical bills.
To answer the student's question:
- Sam does not have Tort Exemption: Since Sam caused the accident, he is not protected from being sued (referred to as tort exemption).
- Betty may sue Sam and Fred for $5,000: This is not necessarily true as the primary purpose of PIP is to cover medical expenses without the need to establish fault.
- Betty must use her own PIP to pay her medical bills: PIP coverage is designed to pay for an insured's medical expenses, so Betty would first claim against her own PIP coverage.
- Sam may recover any damages from Fred's PIP: If Sam does not have his own PIP, he may be covered under Fred's PIP since he was driving Fred's car.
However, the specifics can vary depending on state laws and the policies of the insurance providers involved.