Question

insured and two family members were hospitalized for injuries suffered in an auto crash caused by a drunk driver. The insured carried a basic auto liability policy of 10/20/10. What is the maximum that the insured’s own liability will pay for these injuries?

Answer 1

Answer: The maximum that the insured own liability will pay is $30,000

Explanation: in auto liability insurance policy 10 means that the insurance company can only pay a maximum of $10,000 for any liability incrrued by the insured. and 20 means that the insurance company can only pay a maximum of $20,000 for any liability incrrued by the insured. This means that the insured who has 10/20/10 is eligible to $40,000.

But because the driver was drunk, that means the accident was not a natural cause, but was due to drivers uncarefullnes, the insurance company will only pay a maximum of $10,000 for one person, and a maximum of $20,000 for the hospital bill of the two family members, which makes it a maximum total of $30,000 the insurance company can pay for their hospital bill.

This is in accordance of a principle of insurance called "proximity cause", it means that you must not deliberately cause a liability for an insurance company.