115. A liability policy has $10,000 per occurrence, $50,000 aggregate limit. At different × during the policy period, three people are injured to the amount of $15,000 each. What amount would each person receive?
Answer: A
Each person would receive $10,000.
In this liability policy scenario, each occurrence is capped at $10,000, meaning regardless of the total injury amount, no individual can receive more than this limit.
A) $10,000
This option is correct because the policy stipulates a per occurrence limit of $10,000. Since each of the three injured parties has claims of $15,000, they will each only receive the maximum allowed amount of $10,000 under the policy.
B) $15,000
This option is incorrect because it exceeds the per occurrence limit set by the policy. Although each individual’s claim is $15,000, the liability policy restricts payouts to a maximum of $10,000 per occurrence.
C) $20,000
This option is incorrect as it also exceeds the policy's limits. The claims for each individual are capped at $10,000, making it impossible for any single person to receive $20,000 under the terms of this liability policy.
D) $50,000
This option is incorrect because, while it may represent the total amount for all claims combined, it does not apply to the amount any individual can receive. Each injured party is limited to $10,000, not exceeding the aggregate limits of the policy.
Conclusion
The correct answer is $10,000, reflecting the policy's per occurrence limit. All other options fail to adhere to this cap, either by suggesting amounts that exceed the limit or by misrepresenting how individual payouts work under the terms of the liability policy.