The National Association of Insurance Commissioners (NAIC) recently posed several coverage scenarios about holiday-related losses in categories ranging from auto, homeowners', and credit-card theft. How sharp is your claim-adjusting carving knife? Find out by seeing how many of NAIC's questions you can answer correctly.
If you and a family member are taking turns driving your car to a family gathering and an accident occurs while your relative is driving, whose insurance will provide coverage?
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NAIC: Auto insurance coverage follows the vehicle, so your car will generally be covered while your relative is driving in the same as if you were driving. For example, if your family member slides off the road due to a patch of ice, and you only have liability coverage, there would not be coverage for any damage to the car itself, no matter who was driving.
What if a policyholder takes someone else's car (with their permission) to the store because it was the last one in the driveway, and they accidentally back it into the neighbor's car parked across the street? Who provides coverage?
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NAIC: The existing auto insurance policy on the borrowed vehicle would provide primary coverage in the event of a claim. If no coverage exists, your auto insurance policy might provide coverage. Sometimes, auto insurance coverage will extend to a friend or family member's car you plan on operating.
What if a policyholder loans his car to a family member, and the person is pulled over for driving while intoxicated? Will this affect coverage?
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NAIC: Your automobile coverage will not be affected if another driver is simply ticketed for a driving violation.
If someone breaks into a policyholder's car and steals gifts from the back seat while the car is parked at a mall, would coverage come from the homeowner's policy, the auto policy, or both?
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NAIC: Standard homeowners' and renters' insurance policies provide coverage for this peril, subject to the policy deductible and coverage limits. However, some automobile policies also provide coverage.
What happens if your coworker, a guest at your holiday party, slips and falls on a policyholder's icy driveway?
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NAIC: Standard homeowners' insurance policies will provide limited medical payments coverage if a guest seeks medical attention. If the coworker sues a policyholder for additional damages, a standard homeowners' insurance policy should provide liability coverage.
What if an ice or snow storm causes a tree to fall through the front window of a policyholder's house?
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NAIC: Standard homeowners' insurance policies generally provide coverage for damage to the home — as well as the cost to remove the tree (generally up to $1,000) — if the tree fell due to the weight of ice or snow, minus your deductible. Check your policy to find out what limit of coverage you have. However, your homeowners policy will not help you purchase a new tree.
What if a policyholder's presents are stolen from under the Christmas tree in their living room?
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NAIC: Standard homeowners' insurance policies provide coverage subject to the deductible and special sublimits for certain goods, such as electronics and jewelry. For example, if the wrapped package was a $300 Blu-ray player, there might only be $200 coverage. If the package contained $2,000 worth of jewelry or furs, there might only be $1,500 coverage. Standard condominium and renters' insurance policies provide similar coverage.
Is coverage provided if someone steals the holiday decorations in your front yard?
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NAIC: Under a standard homeowners' insurance policy, decorations are generally covered, subject to a deductible and coverage limits. These items would also generally be covered if you have a condominium or renters' insurance policy.
Is coverage available if holiday candles cause a house fire?
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NAIC: Under a standard homeowners' insurance policy, a home and its belongings will be covered if they are destroyed by a fire, subject to a deductible and policy limits. Standard policies typically provide additional living expenses if you are unable to live in your home due to damage from a fire or other disaster.
If a policyholder's credit card is lost and someone uses it to buy a big screen television, will an insurance policy provide coverage?
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NAIC: Credit card theft might be covered as part of a credit card contract. Standard homeowners' insurance policies typically provide up to $500 of coverage toward your legal obligation to pay your creditor. However, coverage is not provided if a family member, entrusted with the card, buys a big screen television. Federal law also limits a cardholder's responsibility as long as the issuer of the credit card is promptly notified in accordance with the terms and conditions of the cardholder agreement.
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