Motor Carrier and Broker Legal Definitions Quiz
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Questions and Answers

What is bad faith in the context of insurance contracts?

  • A claim made against the tortfeasor's insurer before obtaining a judgment against the tortfeasor
  • A claim made by the insured against their own insurance company for breach of duty
  • The right of the insurer to control the defense and settlement of claims against the insured
  • The duty of the insurer to act in good faith when settling claims against the insured (correct)

    • Under California law, who can sue an insurance company for bad faith?

  • The safety compliance company
  • The third-party claimant
  • The insured (correct)
  • The tortfeasor

    • What is the negligent undertaking theory of liability?

  • The theory that a driver is liable for any injuries caused by a collision
  • The theory that a manufacturer is liable for any injuries caused by a defective product
  • The theory that a retailer is liable for any injuries caused by a defective product
  • The theory that a safety compliance company can be held liable for the failure of a truck company or driver to exercise due care (correct)

    • What is the shift in tort liability that Section 402(A) of the Restatement of Torts (Second) introduced?

    <p>From a conduct-based liability to a defect-based liability</p> Signup and view all the answers

    What are the three types of defects that courts generally recognize in product liability cases?

    <p>Design, manufacturer, and marketing/failure to warn</p> Signup and view all the answers

    What are some red flags that may indicate bad faith on the part of an insurance company?

    <p>Unreasonable denial of a claim, delays in investigation, low settlement offers, unreasonable documentation requests, and failure to pay.</p> Signup and view all the answers

    Who can act against their insurance company for breach of duty under California law?

    <p>The insured</p> Signup and view all the answers

    What is the implied covenant of good faith and fair dealing in an insurance contract?

    <p>It is a duty imposed on the insurer to act in good faith when settling claims and to act reasonably to protect its insured from personal exposure outside the policy limits.</p> Signup and view all the answers

    In what scenarios have safety compliance companies been found liable for negligence?

    <p>Safety compliance companies have been found liable in non-trucking scenarios based on a negligent undertaking theory of liability.</p> Signup and view all the answers

    What are the potential responsible parties in a product liability case involving a vehicle defect or parts failure?

    <p>The company that manufactured the truck or defective equipment, the retailer, the trucking company that allowed an unsafe truck to remain on the road, and the driver who failed to inspect and identify any apparent defects, among others.</p> Signup and view all the answers

    Under California law, a third-party claimant can sue an insurance company for bad faith

    <p>False</p> Signup and view all the answers

    A safety compliance company can be held liable for a truck company or driver's failure to exercise due care in a trucking scenario

    <p>False</p> Signup and view all the answers

    Red flags of bad faith on the part of an insurance company include low settlement offers and unreasonable documentation requests

    <p>True</p> Signup and view all the answers

    Section 402(A) of the Restatement of Torts (Second) only allows for conduct-based liability in product liability cases

    <p>False</p> Signup and view all the answers

    If a vehicle defect or part caused a collision, the manufacturer may be partially or fully liable for any injuries

    <p>True</p> Signup and view all the answers

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