233k views
1 vote
An insured has the following limits: General Aggregate Limit $600,000 Products-Completed Operations Limit $300,000 Personal and Advertising Injury Limit $300,000 Per Occurrence Limit $300,000 Fire Damage/Fire Legal $100,000 Medical Payments Limit $ 5,000 A claim has been filed against your insured for $200,000 and the insurance company has incurred $200,000 in legal defense of the insured. How much coverage is available to pay the damaged third party if a verdict is rendered against the named insured and the insured has already incurred $500,000 of paid liability claims in the policy period? (a) $100,00. (b) $300,000. (c) $400,000. (d) $600,000.

User Psysky
by
8.0k points

1 Answer

1 vote

To determine the coverage available to pay the damaged third party, we need to consider the policy limits and the amounts already incurred.

The General Aggregate Limit is $600,000, which represents the maximum amount the policy will pay for all covered claims in the policy period.

The Per Occurrence Limit is $300,000, which represents the maximum amount the policy will pay for each individual covered claim.

Given that the insured has already incurred $500,000 of paid liability claims in the policy period, we need to subtract this amount from the available coverage.

To calculate the coverage available:

- Start with the General Aggregate Limit of $600,000

- Subtract the amount of paid liability claims already incurred ($500,000)

- The remaining coverage available is $100,000.

Therefore, the answer is (a) $100,000. This is the amount of coverage available to pay the damaged third party if a verdict is rendered against the named insured.

User Linehrr
by
7.6k points