The Limits of Liability on an Insurance Policy Are $1,000,000

question 3

Multiple Choice

The limits of liability on an insurance policy are $1,000,000 for each claim, $4,000,000 aggregate. A nurse is charged in a serious situation in which five separate lawsuits have been filed. What is the most the insurance company will likely pay in this situation?

• A) $4,000,000
• B) $200,000
• C) $1,000,000
• D) $5,000,000

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Definitions:

Common Stock

Represents ownership shares in a corporation, granting shareholders voting rights and a share in the company's profits through dividends.

Account Receivable

Money owed to a company for goods or services that have been delivered but not yet paid for by customers.

Promissory Note

A financial document in which one party promises in writing to pay a determinate sum of money to another party under specific terms.

Dividends

Payments made by a corporation to its shareholders, usually derived from profits, as a distribution of earnings.