Mississippi Property & Casualty Practice Exam

In a Personal Auto Policy, what term describes vehicles that belong to someone else?

1. Owned vehicles

2. Non-owned vehicles

3. Commercial vehicles

4. Rental vehicles

The correct answer is: Non-owned vehicles

In a Personal Auto Policy, the term that describes vehicles belonging to someone else is "non-owned vehicles." This classification is important because it outlines the coverage provided under the policy for vehicles that the insured does not own. Non-owned vehicles may include cars borrowed from friends, family, or coworkers. In the context of insurance, understanding the distinction between owned and non-owned vehicles is crucial, as it affects the liability coverage and other protections that apply in the event of an accident or damage. For instance, if a policyholder uses a non-owned vehicle and gets into an accident, the Personal Auto Policy can extend certain coverages to include that vehicle, subject to the policy's terms and limits. Other terms, like owned vehicles, refer specifically to those that the policyholder personally owns and is insured under the policy. Commercial vehicles pertain to those used for business purposes, while rental vehicles refer specifically to cars rented from an agency. Each category has its own specificities in terms of coverage and exclusions in the context of auto insurance policies. Understanding these definitions ensures that policyholders are adequately informed of their coverage scope and limitations.