13. A Major Medical policy insured is injured in an auto collision during a police chase. The insured is convicted of reckless driving and manslaughter. If the insured files a claim, the insurance company will MOST likely take which of the following actions?
Answer: C
The insurance company will most likely deny the claim only.
In the case of the insured being convicted of reckless driving and manslaughter, the insurance company is likely to deny the claim due to the illegal activities involved in the incident.
A) Pay full benefits
Paying full benefits would be inappropriate in this situation because the insured's actions were criminal in nature. Insurance policies typically have exclusions for claims arising from illegal activities, making this option highly unlikely.
B) Pay partial benefits
Paying partial benefits would also not be a plausible action by the insurance company. The conviction for reckless driving and manslaughter indicates a significant breach of policy terms, which usually leads to a complete denial of coverage rather than a partial payment.
C) Deny the claim only
Denying the claim is the most probable action by the insurance company. Given the insured's conviction for serious offenses, the insurer is justified in rejecting the claim based on the illegal nature of the actions leading to the injury.
D) Deny the claim and return the premiums paid
While the insurance company may deny the claim, returning the premiums paid is not a standard practice in such cases. The conviction for serious crimes typically results in a denial of coverage without a refund of premiums, as the insurer is not liable for claims arising from illegal acts.
Conclusion
The correct answer is that the insurance company will most likely deny the claim only, as the insured's involvement in criminal activities fundamentally breaches the terms of their policy. Other options fail to recognize the implications of the insured's actions, which directly impact the validity of the claim and the insurer's obligations.