Gary Purchased a Personal Auto Policy (PAP) That Included Collision

question 52

Multiple Choice

Gary purchased a Personal Auto Policy (PAP) that included collision coverage. Gary lost control of his vehicle on an icy road. He slid across the center line into oncoming traffic. Another vehicle hit his car, causing severe damage to it. Ignoring any deductible, what is the insurer's liability for damage to Gary's car?

• A) the greater of the actual cash value or the amount necessary to repair or replace the vehicle
• B) the replacement cost of the vehicle
• C) the lesser of the actual cash value or the amount necessary to repair or replace the vehicle
• D) the original purchase price of the vehicle

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Definitions:

Cyclical Unemployment

Cyclical unemployment refers to the fluctuation in unemployment that occurs due to the ups and downs of the economy over time.

Structural Unemployment

The occurrence of unemployment caused by the reformation within industries, often as a result of technological innovations, rather than changes in market demand or supply.

Unemployment Insurance

A government-provided financial assistance program for individuals who have lost their jobs, offering temporary financial support.

Minimum Wage

The lowest legally enforceable wage that employers can pay their workers, aimed at protecting workers from exploitation.