Question

An insured purchased an auto policy for his new car. He wants to understand what perils are not insured against. Which section of his policy should the insured check?

A) Declarations

B) Exclusions

C) Conditions

D) Insuring Agreement

Answer 1

The insured should check the Exclusions section of his auto policy to understand which perils are not covered. This section lists all the incidents and damages that the insurance does not protect against, unlike the Declarations, Conditions, or Insuring Agreement sections which serve different purposes.

Step-by-step explanation:

To understand which perils are not covered by his auto policy, the insured should review the Exclusions section of the policy. The Exclusions section specifically outlines what the insurance policy does not cover. It can include a range of things from damage caused by normal wear and tear, intentional damage, or damages resulting from certain natural disasters, depending on the policy.

The other sections mentioned serve different purposes:

• The Declarations page generally includes the policyholder's details, the policy effective dates, vehicle information, the coverages purchased, and the limits and deductibles for each coverage.
• The Conditions section details the legal responsibilities of both the insured and the insurer, including the procedures for filing a claim and the protocol for dispute resolution.
• The Insuring Agreement outlines what the insurer promises to provide in terms of coverage, subject to the terms and limitations of the policy.

By reviewing the Exclusions section, the insured will have a clear understanding of what incidents or damages are not covered under his policy.