Exam Simulation for United States Personal Lines Question 46 of 50Select Your An

Question

Exam Simulation for United States Personal Lines Question 46 of 50Select Your Answer Quit Andrew obtained other insurance for his personal automobile through a lower cost insurer because he has an excellent driving record. Because the coverage is similar to the coverage that his previous insurer provided, what will happen to the coverage provided by the previous insurer? A The coverage will continue until all previously paid premiums have been exhausted and lapse once that has occurred. B The gimilar coverage under the "old" policy will automatically terminate on the date that the "new" policy becomes effective. The coverage from the "new insurer will supersede the "old policy regardless of the time in which both policies are in effect Andrew will have the option to continue the coverage until the next policy renewal, which will provide-him with duplicate coverage in the event of an accident [AD1 Prev | Next Time Remaining 00 5457

Explanation / Answer

The correct answer would be Option (D). The existing insurance will not cease to exist unless Andrew specifically informs his existing insurer about moving on to another insurer. Hence, it is absolutely necessary that Andrew communicates his decision of getting a new insurance to his current insurer. In fact Andrews can inform and get his current insurance cancelled before it comes up for renewal. This might however attract mid term policy cancellation penalty charges from his current insurer.

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