Types of Casualty Policies

Correct

The answer is B: No coverage, because the named driver exclusion applies to the son

A named driver exclusion endorsement removes coverage while a specifically named individual is driving. Texas allows it only if the endorsement names each excluded driver and the named insured accepts it in writing (Insurance Code §1952.353(b)). Even though the son is a household member who would normally be covered, the accepted endorsement overrides the standard provisions: under the standard Texas endorsement, none of the policy's coverages apply while the excluded driver operates the covered auto or any other vehicle. This endorsement is often used to reduce premiums when a high-risk driver in the household has their own separate policy.

Source: Insurance Code §1952.353(b)

Correct

The answer is B: An SR-22 financial responsibility filing

An SR-22 is not an insurance policy itself — it is a certificate filed by an insurer with the Texas Department of Public Safety proving that the driver carries at least the state-required minimum liability limits (30/60/25 in Texas). DPS requires one to reinstate a license suspended after a DWI conviction, and after a second or later conviction for driving without insurance (Transportation Code §601.231). The filing must be maintained for two years from the conviction; if the policy lapses, the insurer must notify the state.

Source: §601.231

Correct

The answer is D: On request by a peace officer, or by others in a collision

The Texas Motor Vehicle Safety Responsibility Act bars anyone from operating a motor vehicle in Texas unless financial responsibility is established for it, through a liability policy meeting the 30/60/25 minimums, a surety bond, a deposit, or self-insurance (Transportation Code §601.051). The operator must show evidence of it when a peace officer asks, or to a person involved in a collision with the operator (§601.053). The Act also has follow-up rules, such as security requirements for uninsured drivers after collisions causing injury, death or at least $1,000 in property damage (§601.151) and license suspension after repeat convictions for driving without financial responsibility (§601.231), but the core duty applies to ordinary driving, not only after a violation, a conviction or a purchase.

Source: §601.051 · Insurance Code §601.053 · Insurance Code §601.151 · Insurance Code §601.231

Correct

The answer is D: The injured driver must prove the other driver was at fault

In a tort-based system like Texas, the at-fault party is responsible for paying damages. The injured party must prove the other driver's negligence to recover from that driver's liability insurance. Unlike no-fault states, Texas does not replace the right to sue with first-party benefits. An insurer must include personal injury protection (PIP) in an auto liability policy unless the named insured rejects it in writing (Insurance Code §1952.152). The tort system preserves the right to sue for all damages, including pain and suffering.

Source: Insurance Code §1952.152

Correct

The answer is C: Medical Payments pays medical costs; PIP adds lost income

Medical Payments coverage (Part B of the PAP) pays reasonable medical and funeral expenses for the insured and passengers, regardless of fault, up to a per-person limit. PIP (Personal Injury Protection) is broader — it covers medical expenses, lost income, essential services (like childcare), and funeral expenses. In Texas, an insurer must include PIP in an auto liability policy unless the named insured rejects it in writing (Insurance Code §1952.152), while Medical Payments is purely optional. The $5,000 limit applies per person, so each occupant could receive up to $5,000.

Source: Insurance Code §1952.152