Registered Insurance Brokers of Ontario (RIBO) Practice Exam

In claims that exceed the minimum liability limit for bodily injury and property damage, how is money apportioned?

1. $50,000 to Bodily Injury and $150,000 to Property Damage

2. $190,000 to Bodily Injury and $10,000 to Property Damage

3. $200,000 to Bodily Injury and $0 to Property Damage

4. $150,000 to Bodily Injury and $50,000 to Property Damage

The correct answer is: $190,000 to Bodily Injury and $10,000 to Property Damage

The appropriate approach to apportioning funds in claims exceeding the minimum liability limits focuses on ensuring that both categories are adequately funded according to the specifics of the case. When determining how to distribute the available money, one must consider the damages as they apply to bodily injury and property damage. In this context, the correct answer reflects an allocation where bodily injury receives a substantial amount, acknowledging the often higher costs associated with injuries, medical expenses, and related liabilities. Property damage, while significant, typically garners a smaller portion of the overall payment when bodily injuries are involved. The chosen answer illustrates a realistic and common scenario where bodily injuries usually require more financial attention due to the potential for greater recovery costs, including lost wages, therapy, and long-term medical care. This distribution aligns with the practices seen in personal injury claims where the severity and nature of bodily injuries frequently necessitate higher compensation compared to property damage alone. Understanding how these funds are allocated helps in appreciating the balance insurers must maintain when dealing with liability claims while considering the typical implications of personal injury settlements versus property claims.