West Virginia Adjusters Practice Exam

What happens if Erin was living in the same household as Sebastian when her car was rear-ended?

1. The insurance company may refuse to pay the claim.

2. The insurance company must pay for damages if covered by the policy.

3. The claim must still be denied.

4. Erin must file a new policy for herself.

The correct answer is: The insurance company may refuse to pay the claim.

If Erin was living in the same household as Sebastian when her car was rear-ended, the insurance company may refuse to pay the claim. This is because insurance companies typically have rules against insuring multiple individuals from the same household under the same policy. This is to prevent fraud or misuse of the policy. Therefore, the insurance company may argue that Erin was not explicitly covered under Sebastian's policy and thus, may refuse to pay for any damages. Option B is incorrect because even if the policy covers damages, the insurance company may still refuse to pay if Erin is not listed as a covered individual. Option C is incorrect because the claim may not be denied solely based on living in the same household as Sebastian, but rather whether or not Erin was explicitly covered under the policy. Option D is incorrect because there is no need for Erin to file a new policy for herself as she may still be able to file a claim under Sebastian's policy if listed as a covered individual.