Question 83

Tom's policy can pay a maximum of $2,000 to both himself and his neighbor for medical expenses incurred in an accident.

In the event of an automobile accident where Tom gives his neighbor a ride and both incur medical expenses, the personal automobile policy will cover up to $2,000 for each individual involved in the accident.

A) Tom's daughter is struck by a car. Tom's policy will pay nothing because she was riding her bicycle in the street.

This statement is incorrect. While Tom's daughter may not be covered under his automobile policy while riding her bicycle, the policy does not automatically negate coverage for other scenarios involving medical payments. The medical payments coverage typically applies to insured individuals involved in an accident, regardless of their mode of transportation.

B) Tom's daughter is struck by a car while crossing the street. Tom's policy will pay nothing because she was not in a car at the time of the accident.

This statement is also incorrect. Although Tom's daughter was not in a vehicle at the time of the accident, medical payments coverage can sometimes extend to pedestrians, depending on the specifics of the policy. Thus, the policy may still provide coverage for necessary medical expenses incurred by her.

C) Tom is injured in an accident while riding in his neighbor's car. His neighbor carries $2,000 medical payments coverage. The maximum amount that would be paid by both policies for Tom's medical expense is a total amount of $2,000.

This statement is misleading. While Tom's neighbor's policy may also provide $2,000 in medical payments, Tom's own policy can also cover up to $2,000 for his medical expenses. Therefore, the total amount payable could exceed $2,000 because each policy would provide separate coverage.

D) Tom gives his neighbor a ride to the store in the insured car. He has an automobile accident in which they each incur over $2,000 of medical expenses. The maximum amount that would be paid by Tom's policy is $2,000 to him and $2,000 to his neighbor.

This statement is correct. Tom's personal automobile policy provides medical payments coverage with a limit of $2,000 per person. Therefore, in the event of an accident where both Tom and his neighbor incur medical expenses, each can receive up to the policy limit of $2,000 for their respective medical expenses.

Conclusion

The correct answer is option D, as it accurately reflects the coverage limits of Tom's personal automobile policy for medical payments in the scenario described. Options A, B, and C misunderstand how medical payments coverage applies in different situations, leading to incorrect conclusions about the policy's coverage limits and circumstances.