Question

27. A personal auto policy would be considered excess when an insured

(Choose from the following options)
1. Buys a car and is then involved in an accident less than 30 days later.
2. Pays more for collision coverage than the car is worth.
3. Has another auto policy and the car is involved in an accident.
4. Leaves his car in a parking garage and the car is involved in an accident.

Answer 1

An insured personal auto policy would be considered excess when the insured has another auto policy and the car is involved in an accident.

Step-by-step explanation:

An insured personal auto policy would be considered excess when the insured has another auto policy and the car is involved in an accident.

For example, let's say that the insured has a personal auto policy with one insurance company and also has coverage under a different auto policy with a second insurance company. If the insured's car is involved in an accident, the second auto policy would be considered primary and would be responsible for paying the damages up to its policy limits. If the damages exceed the limits of the second auto policy, then the insured's personal auto policy would come into play as excess coverage to cover the remaining expenses.