Pennsylvania Property & Casualty: The Personal Automobile Policy

Correct

The answer is D: The insurer may deny coverage if it shows the failure to give notice and cooperate prejudiced it.

The PAP conditions coverage on prompt notice and cooperation in the investigation, settlement or defense of a claim, and the insurer has no duty to provide coverage if the failure to comply is prejudicial to it. Pennsylvania also requires an insurer relying on late notice to prove prejudice from the breach (Brakeman). An insured who settles alone and never notifies the insurer takes that risk, because the policy leaves the insurer to settle or defend as it considers appropriate. Such a settlement does not bind the insurer, and defense and supplementary payments are owed only where coverage applies.

Reviewed in our October 2026 Pennsylvania fact-check.

Correct

The answer is A: $3,750

Comprehensive (Other Than Collision) covers falling objects and windstorm, so the tree damage is covered subject to the deductible. The insurer pays the loss less the deductible: $4,000 - $250 = $3,750. Paying the full $4,000 ignores the deductible, $4,250 adds it instead of subtracting it, and windstorm is a covered peril, not an exclusion.

Reviewed in our October 2026 Pennsylvania fact-check.

Correct

The answer is B: $2,500

Under comprehensive coverage, the insurer pays the cost to repair the damage, less the deductible, up to the actual cash value (ACV) of the vehicle. Here, the repair cost is $3,000, which is less than the ACV of $4,000, so the insurer pays the repair cost minus the deductible: $3,000 - $500 = $2,500. The insurer does not pay the ACV unless the vehicle is a total loss (repair cost exceeds ACV).

Reviewed in our October 2026 Pennsylvania fact-check.

Correct

The answer is A: $4,000 ($5,000 ACV minus $1,000 deductible).

Collision pays the lesser of the actual cash value or the cost to repair, less the deductible. The ACV ($5,000) is less than the repair cost ($6,500), so the payment is $5,000 - $1,000 = $4,000. Paying the full ACV ignores the deductible, using the repair cost ignores the ACV ceiling, and paying the repair cost with no deductible ignores both.

Reviewed in our October 2026 Pennsylvania fact-check.

Correct

The answer is D: The insurer must pay the $2,800 repair cost minus the $250 deductible, or $2,550, because the storm damage is covered.

Falling objects and windstorm are other-than-collision losses. The unrelated worn transmission did not cause the branch damage, so it neither reduces nor defeats payment for that damage; the policy excludes the mechanical wear itself, not the covered loss. The insurer pays the lesser of the repair cost or the ACV, minus the deductible: $2,800 - $250 = $2,550. This is a repairable loss, not a total loss.

Reviewed in our October 2026 Pennsylvania fact-check.