West Virginia Adjusters Practice Exam

Why might the insurance company refuse to pay a claim filed by Sebastian for damages to Erin's car after she was rear-ended by a hit-and-run driver?

1. Erin and Sebastian are not living in the same household.

2. Erin did not purchase additional coverage for hit-and-run incidents.

3. Erin's car is not listed on the policy.

4. Erin did not file a police report.

The correct answer is: Erin and Sebastian are not living in the same household.

The reason for the insurance company refusing to pay a claim filed by Sebastian for damages to Erin's car after she was rear-ended by a hit-and-run driver relates primarily to the parameters of the insurance coverage and the specifics of the situation. In this context, the insurance policy typically covers damages to vehicles listed on the policy and may have specific stipulations about who can file claims. If Erin's car is not listed on Sebastian's insurance policy, the insurer may refuse to pay for attributable damages. This implies that regardless of their relationship or household status, what truly matters is whether the vehicle is properly covered under the relevant insurance policy. The context surrounding the other options further clarifies the scenario: If Erin did not purchase additional coverage for hit-and-run incidents, the limitations of her insurance policy would determine whether any damages could be covered. Similarly, if a police report was not filed, some insurers might see this as a lapse in adequately documenting the claim, which could potentially lead to denial; however, it is not as centrally critical as the matter of vehicle coverage. Thus, the primary factor causing the claim denial here relates to the specific vehicle coverage rather than the personal living situation between Erin and Sebastian.