If a personal auto policy has a single limit of $100,000 for liability and six people are injured for a total of $150,000, how much will the policy pay?

Prepare for the Personal Lines Insurance Exam with top quizzes. Use multiple choice questions, complete with hints and explanations, to get ready for your test.

In this scenario, the personal auto policy has a single limit of $100,000 for liability coverage. This means that no matter how many people are injured in an accident, the maximum amount the insurance company will pay out for all claims combined is capped at $100,000.

Since there are injuries totaling $150,000, the insurance coverage is insufficient to cover the entire amount. However, the policy will only pay up to its limit, which is $100,000.

Therefore, the policy will disburse $100,000, as this is the maximum liability coverage available under the terms of the policy. Any amount beyond this limit, which would be an additional $50,000 in this case, will not be covered by the insurance policy and would have to be paid by the insured party out of pocket.

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