Question

Donnie and Marie are driving through the countryside one lazy Sunday afternoon when a cow stumbles out into the road right in front of them. Donnie can't avoid the animal and hits it square on, killing the cow and severely damaging the front end of his car. His Personal Auto Policy has a $250 Collision deductible and no deductible for Other than Collision. The repair estimate is $2,350.00. How much will Donnie's policy pay for repair to the car and under what coverage?

(A) $2,100.00 under Donnie's Collision coverage
(B) $2,100.00 under his Liability coverage since the cow can't legally be at fault.
(C) $2,350.00 under Donnie's Collision coverage
(D) $2,350.00 under Donnie's Other than Collision coverage

Answer 1

Donnie's Personal Auto Policy will pay $2,100.00 for the car repairs under his Collision coverage. The amount is the total estimated repair cost of $2,350.00 minus his $250 deductible.

Step-by-step explanation:

When Donnie hits a cow and damages his car, the repair costs amount to $2,350.00. Given that Donnie's Personal Auto Policy includes a $250 Collision deductible and no deductible for Other than Collision, the coverage for this incident would fall under Collision, since striking an animal falls under the purview of a collision event.

Thus, Donnie's policy will pay for the repairs to his car minus the deductible. This means the insurance will cover $2,100.00 (which is the total damage of $2,350.00 minus the $250 deductible), under Donnie's Collision coverage. Liability coverage would not be applicable here since liability insurance covers damages to others and their property, not the policyholder's own vehicle.