A Florida homeowner has a Personal Auto Policy (PAP) with a split limit of 25/50/25 for Bodily Injury and Property Damage Liability. They are involved in an at-fault accident that causes $30,000 in bodily injury to one person, $15,000 in bodily injury to a second person, and $10,000 in property damage. How much will their PAP pay for the bodily injury claims?
- A$40,000
- B$50,000
- C$25,000
- D$45,000
Show answer & explanationAnswer & explanation
Correct answer: A. $40,000
Split limits are read as: (Per Person Bodily Injury) / (Per Accident Bodily Injury) / (Per Accident Property Damage). In this case, 25/50/25 means $25,000 per person for bodily injury, and $50,000 total for all bodily injury in one accident. For the first person, the claim is $30,000, but the policy pays only up to $25,000 (per person limit). For the second person, the claim is $15,000, which is within the $25,000 per person limit. So, the policy pays $25,000 + $15,000 = $40,000. This amount is also within the $50,000 per accident bodily injury limit.
Why the other options are wrong
- B. This would be the maximum per-accident bodily injury limit, but the per-person limit restricts the payment for the first injured party.
- C. This only accounts for the payment to the first injured person, neglecting the second.
- D. This would be the sum of all bodily injury claims ($30,000 + $15,000), but the per-person limit applies.
PAP Split Limits
Personal Auto Policy (PAP) split limits specify separate maximum payments for bodily injury per person, bodily injury per accident, and property damage per accident.
- Format: BI per person / BI per accident / PD per accident.
- Per person limit is the absolute maximum for one individual's BI.
- Per accident BI limit is the total maximum for all individuals' BI in one incident.
Memory trick: Split limits are 'P.A.P.' - 'Per-person, Accident, Property' damage.