Priorities of payment relate to payment of which types of losses under an automobile insurance policy?

Priorities of payment relate to payment of which types of losses under an automobile insurance policy?

• A. Collision and Property damage
• B. Collision and Direct Compensation
• C. Comprehensive and Bodily Injury
• D. Bodily Injury and Property Damage

Answer: (D)

Priority of payment refers to which losses the insurer pays first when multiple coverages could apply. In an auto policy, the liability coverages—bodily injury and property damage—handle the claims of others harmed or whose property was damaged in an accident. These are the primary, third-party losses and are paid first. The insured’s own vehicle damage or injuries are addressed by first-party coverages like collision and comprehensive, which come into play after or alongside liability if applicable. So, the losses that have priority of payment are bodily injury and property damage.

Priority of payment refers to which losses the insurer pays first when multiple coverages could apply. In an auto policy, the liability coverages—bodily injury and property damage—handle the claims of others harmed or whose property was damaged in an accident. These are the primary, third-party losses and are paid first. The insured’s own vehicle damage or injuries are addressed by first-party coverages like collision and comprehensive, which come into play after or alongside liability if applicable. So, the losses that have priority of payment are bodily injury and property damage.