Arkansas Insurance Adjuster Practice Exam 2025 – Comprehensive All-in-One Guide to Exam Success

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Kelly took her eyes off the road and ended up smashing into the back of a passenger van. How much will she have to pay out of pocket if all five passengers were injured with each one incurring $25,000 in medical costs, assuming Kelly has liability coverage with limits of 50/100/50?

$10,000

$50,000

$25,000

Kelly will have to pay $25,000 out of pocket. This is because the 50/100/50 liability coverage refers to the maximum amount that the insurance company will pay for each person (up to $50,000) and the maximum amount they will pay for all individuals involved (up to $100,000). Since each passenger incurs $25,000 in medical costs, the insurance company will cover $50,000 for the two most severely injured passengers and $25,000 each for the remaining three, leaving Kelly responsible for the remaining $25,000 out of pocket. Option A is incorrect because it only covers a portion of the total cost. Option B and D are incorrect because they exceed the coverage limits.

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$15,000

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