Helen and John Both Own Automobiles on Which They Carry

question 35

Multiple Choice

Helen and John both own automobiles on which they carry liability insurance.If Helen is negligent and has an accident while driving John's car with his permission,how will each insurer respond to any liability judgment against Helen?

• A)The insurers will pay the judgment on a pro rata basis.
• B)John's insurer will pay on an excess basis if Helen's insurance is insufficient to cover the judgment.
• C)Helen's insurance will pay on an excess basis if John's insurance is insufficient to cover the judgment.
• D)The policies will pay the judgment on the basis of contribution by equal shares.

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Definitions:

Just in Time

The Just in Time (JIT) methodology is an inventory management strategy that aims to reduce waste and increase efficiency by receiving goods only as they are needed in the production process.

Suppliers

Entities or individuals that provide goods or services to other entities or individuals, typically within a business or manufacturing process.

Short-term Financing

Refers to the obtaining of loans or other monetary support for a period of typically less than one year, to address immediate financial needs.

Long-term Financing

Funding obtained for a time frame exceeding one year in duration, typically used for acquiring or investing in assets that have a long useful life.