Texas Property and Casualty License Practice Exam

Which of the following is NOT a liability exclusion in a personal auto policy?

1. Damage to another person's property

2. Use of vehicle without permission

3. Loss caused intentionally by the insured

4. Use of vehicle as a public or taxi transporter

The correct answer is: Damage to another person's property

A personal auto policy typically includes liability coverage to protect the insured from claims and lawsuits arising from damages they cause to others. Specifically, the coverage for damage to another person's property is a fundamental feature of liability insurance, allowing policyholders to be financially protected in cases where they are found at fault for causing damage in an accident. This coverage ensures that the injured party is compensated, which is a key purpose of liability insurance. In contrast, the other options represent situations that are generally excluded from liability coverage. When a vehicle is used without permission, or if the loss is intentional, these actions fall outside the protections offered by liability insurance. Additionally, using the vehicle as a taxi or for public transportation also poses greater risks and is not covered under standard personal auto policies. Understanding these nuances helps clarify what is protected under a personal auto policy and highlights the importance of reviewing exclusions to maintain adequate insurance coverage.