Preferred Financial Group

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Below is a sample Auto Insurance Policy

used to illustrate how an auto claim might be viewed and settled by the insurance company.

Example #5

      • What Happened?: The insured ran a red light and collided with another vehicle.
            • Caused $5,000 damage to his car
            • Caused $10,000 damage to the other car
            • A passenger in his car suffered injuries amounting to $3,000
            • The driver of the other car was seriously injured and filed suit which was settled for $425,000.
      • What Was Covered?:
            • Insured’s car was covered under Collision for the full amount of $5,000 minus the $1,000 deductible.
            • Damage to the other car was covered under Property Damage Liability for the full amount of $10,000.
            • Medical expenses for his passenger was covered under Medical Payments for the full amount of $3,000
            • The settlement of $425,000 was covered under Bodily Injury Liability for the entire amount.
      • Explanation: In all cases the losses were within the policy limits and as such, claims were paid minus the policy deductible amounts where applicable.