Question 50

Deductibles apply to collision and comprehensive coverage.

In personal automobile insurance, deductibles specifically apply to collision and comprehensive coverage, which means that policyholders must pay a certain amount out of pocket before their insurance covers the remainder of the claim.

A) Medical payment

Medical payment coverage does not involve deductibles. This type of coverage pays for medical expenses resulting from an accident, regardless of fault, and is typically paid in full by the insurer without requiring a deductible.

B) Collision and comprehensive coverage

Collision and comprehensive coverage are the areas of automobile insurance where deductibles are applicable. When a claim is made under these coverages, the insured must first pay the deductible amount before the insurance company pays the rest of the claim, making this option correct.

C) Bodily injury

Bodily injury coverage is designed to cover injuries sustained by others in an accident for which the policyholder is at fault. This type of coverage does not involve a deductible because it is a liability coverage, not one that requires a personal out-of-pocket payment for damages.

D) Supplementary payments

Supplementary payments are additional benefits provided by an insurance policy, such as coverage for court costs and certain legal fees. These payments do not require a deductible, as they are meant to cover expenses incurred by the insured beyond the primary liability limits.

Conclusion

The correct answer is B, as deductibles are specifically associated with collision and comprehensive coverage, requiring policyholders to bear some initial cost before insurance kicks in. All other options relate to types of coverage that either do not involve deductibles or serve a different purpose within an automobile insurance policy.