Business Auto Coverage

There are 2 business Auto Declarations available

1. Business Auto Coverage Form Declarations - This brief Declaration, which does not duplicate information found in the Common Policy Declarations, is used when coverage is being written as part of the Commercial Package Policy. 2. Business Auto Declarations - This Declaration is used when the coverage is being written as a monoline policy. a. It includes information such as: 1) Named insured and mailing address. 2) Policy period. 3) Coverages and limits of liability, including the premium for each coverage. 4) Schedule of owned autos. 5) Schedule of hired or borrowed autos. 6) Non-ownership liability. b. If a coverage does not apply, that coverage's section will be left blank.

Section VI - Definitions

1. Customer's Auto - A customer's land motor vehicle, trailer, or semitrailer. It includes any customer's auto that is left with the insured for service, repair, storage, or safekeeping. 2. Garage Operations - The ownership, maintenance, or use of locations for garage business, and that portion of the roads, or other accesses, that adjoin those locations.

False Pretense Coverage

1. This endorsement covers the insured for loss caused by someone causing the insured to voluntarily part with a covered auto by trick, scheme, or false pretense, or the insured acquiring an auto from a seller who did not have legal title. 2. A covered auto includes any auto acquired by the insured.

Individual Named Insured

1. This endorsement is used to add family coverage to the Business Auto Coverage Form. 2. The endorsement is commonly used where a sole proprietor or partner desires to let his/her family members drive their business autos. 3. When purchased, the endorsement would apply to all family members who are residents of the same household.

Drive Other Car Coverage

1. This endorsement is used whenever all the named insured's vehicles are covered under the Business Auto Coverage Form, and therefore they carry no personal auto coverage. 2. This endorsement extends coverage to the persons named thereon if they rent or borrow a nonowned auto for personal purposes. 3. The endorsement is commonly used when a company executive is furnished a company car and does not carry a Personal Auto Policy because he/she does not own a personal vehicle.

Employees as Additional Insureds

1. This endorsement provides coverage under the Business Auto Coverage Form to protect employees as insureds. 2. The endorsement is primarily used in instances where employees use their own autos in the course of the insured's business.

Hired Autos Specified as Covered Autos You Own

1. This is an endorsement for insureds who hire automobiles on a long term basis. 2. The vehicles to be covered are specified in the endorsement, and there is no coverage for vehicles other than those specified. 3. The rates used for the hired automobiles insured are the same as though the insured owned the vehicles. 4. The owner of the vehicle is added as an additional insured along with the insured who hires it.

Mobile Equipment

1. This is an endorsement that allows mobile equipment such as bulldozers, forklifts, and road construction equipment to be considered as covered autos. 2. This type of equipment would not normally be covered, except for liability arising while being carried or towed by a covered auto.

Section VI - Definitions

1. Trailer - Includes a semitrailer or dolly (attachment) used to convert a semitrailer into a trailer. 2. Trucker - Any person or organization engaged in the business of transporting property by auto for hire.

Section I - Covered Autos

9 classifications 1. Description of Covered Auto Designation Symbols Symbol 1: Any Auto, Symbol 2: Owned Autos Only, Symbol 3: Owned Private Passenger Autos Onlym, Symbol 4: Owned Autos Other Than Private Passenger Autos Only, Symbol 5: Owned Autos Subject to No Fault, Symbol 6: Owned Autos Subject to a Compulsory Uninsured Motorist Law, Symbol 7: Specifically Described Autos - Autos described in Item 3 (Schedule of Covered Autos the Insured Owns) of the Declarations for which a premium charge is shown. Symbol 8: Hired Autos Only - Only those autos the insured leases, hires, rents or borrows, except any auto the insured leases, hires, rents, or borrows from an employee or member of the employee's household. Symbol 9: Nonowned Autos Only - Only those autos the insured does not own, lease, hire, or borrow, which are used in connection with the insured's business. This includes autos owned by an employee of the insured, or a member of the employee's household, but only while used in the insured's business or the insured's personal affairs. Note: The main distinction between a hired and a nonowned auto is whether an employee owns the auto.

Section II - Liability Coverage

Coverage is provided for bodily injury or property damage caused by an accident for which the insured is legally responsible. The insurer will also pay for any covered pollution cost or expense caused by an accident if there is either bodily injury or property damage caused by the same accident.

Section IV - Physical Damage Coverage

See the Business Auto Coverage Form.

Section V - Truckers Conditions

See the Business Auto Coverage Form.

Garage Coverage Form

The Garage Coverage Form is designed to provide automobile liability and physical damage coverage, as well as general liability protection for businesses that are engaged in the sale, service, or storage of automobiles. Eligible businesses include automobile sales agencies, repair shops, service stations, storage garages, and public parking places. The Garage Coverage Form contains 6 sections:

Section IV - Business Auto Conditions

The following conditions apply in addition to the Common Policy Conditions: 1. Loss Conditions - Appraisal, duties in the event of an accident, legal action against the insurer, loss payment, and transfer of rights of recovery. 2. General Conditions - Bankruptcy; concealment, misrepresentation, or fraud; liberalization; no benefit to bailee; other insurance; premium audit; policy period, coverage territory; and 2 or more coverage forms issued by the insurer.

Section V - Garage Conditions

These conditions apply in addition to the Common Policy Conditions and are essentially the same as conditions stated under the Business Auto Coverage Form.

Section I - Covered Autos

This Section is similar to Section I of the Business Auto Coverage Form, but also provides a symbol for trailers in the insured's possession with a written agreement, and a symbol for the insured's trailers while in the possession of anyone else under a written agreement.

The Endorsement for Motor Carrier Policies of Insurance for Public Liability

This endorsement provides evidence of financial responsibility, on behalf of the motor carrier, to the Interstate Commerce Commission (ICC). The endorsement must be included in any policy, and the policy must meet the DOT financial responsibility requirements, including: 1. No condition, provision, stipulation, or limitation contained in the policy will relieve the insurer from liability (absolute liability for the insurer). 2. If the insurer is required to pay an excluded loss (under the policy), it may seek reimbursement from the insured. 3. Coverage is in effect until terminated (continuous). 4. An insurer must give notice at least 35 days' advance notice of cancellation.

The Motor Carrier Act of 1980

This federal legislation authorizes the Department of Transportation (DOT) to enforce the financial requirements for motor carriers. The DOT has ruled that a motor carrier must either carry an insurance policy of certain minimum limits, or post a surety bond representing certain financial stability criteria when transporting passengers or cargo. The most common approach is the purchase of insurance.

Motor Carrier Coverage Form

This form is a variation of traditional trucker's coverage developed to reflect certain changes in motor carrier regulation. It may, in some instances, provide a better coverage alternative for some carriers than the Truckers Coverage Form. The main difference between this form and the Truckers Coverage Form is the operating right granted by the Public Authority. For example, the Truckers Coverage Form says a trucker is someone engaged in the business of transporting property for hire, while a motor carrier is engaged in transporting property or passengers.

Truckers Coverage Form

This form is patterned after the Business Auto Coverage Form with some modifications and is designed for those firms or persons that are in the business of transporting goods or commodities for another. The form is divided into 6 sections:

Section III - Trailer Interchange Coverage

This is physical damage coverage for those trailers that the insured does not own but has in his/her possession along with a written Trailer Interchange Agreement in which the insured assumes liability for loss to the trailer. Loss of use of such trailers is not covered.

Section I - Covered Autos

This section describes which autos are covered for each coverage. Automatic blanket coverage may be provided. Coverage is usually written on a blanket basis.

Section IV - Physical Damage Coverage

This section provides Physical Damage Coverage for covered autos and their equipment specified in the Declarations. The coverage is for the insured's own vehicles and is the same as Physical Damage Coverage under the Business Auto Coverage Form. When a car dealer has an auto inventory that fluctuates from month to month, he/she should cover the inventory on a Value Reporting Form basis.

Section II - Liability Coverage

This section provides bodily injury and property damage liability coverage for losses resulting from garage operations. In addition to Automobile Liability, this coverage includes Premises and Operations Liability, Products Liability, and Completed Operations Liability. This section does not cover property in the care and custody of the insured, injuries covered by Workers' Compensation, and liability arising from pollution or product recall. Completed Operations losses are subject to a mandatory $100 deductible.

Section III - Garagekeepers Coverage 1

This section provides coverage for physical damage to a customer's car that is in the care of the insured. The insured may select the following coverages: 1. Comprehensive Coverage - This coverage is the same as Comprehensive Coverage under the Business Auto Coverage Form. 2. Specified Causes of Loss - This coverage covers fire, lightning, explosion, theft, mischief, or vandalism. 3. Collision Coverage - This coverage is the same as Collision under the Business Auto Coverage Form. 4. Garagekeepers Coverage on a Legal Liability Basis, Direct Excess Basis, or Direct Primary Basis - The insured may elect one of the following:

Business Auto Coverage Form

a. Is divided into 5 sections (discussed after the Declarations). b. Is used to cover owned, leased, hired, rented, or borrowed private passenger autos, trucks, trailers, and semitrailers that are owned and used by businesses. c. Provides liability coverage for trailers being towed by a covered vehicle. d. Does not provide automatic coverage for physical damage to trailers.

Section II - Liability Coverage

a. Is divided into 5 sections (discussed after the Declarations). b. Is used to cover owned, leased, hired, rented, or borrowed private passenger autos, trucks, trailers, and semitrailers that are owned and used by businesses. c. Provides liability coverage for trailers being towed by a covered vehicle. d. Does not provide automatic coverage for physical damage to trailers.

Section III - Garagekeepers Coverage 2

a. Legal Liability Basis - Coverage applies only if the garage is legally liable for damage. b. Direct Excess Basis - Coverage applies regardless of liability, but only if the customer has no physical damage coverage of their own. c. Direct Primary Basis - Coverage applies regardless of liability, and whether or not the customer has physical damage coverage of their own. Note: Theft by an insured, employee, or stockholder thereof is not covered. There is no coverage in this section for defective parts or faulty work, which are covered in Section II - Liability Coverage.

The primary factors for rating business auto are as follows:

a. Original cost of the vehicle when it was new. b. The territory where the vehicle will be principally garaged. This does not necessarily mean where the business is located. c. Radius of operation. Under 50 miles short haul, 50 to 200 miles intermediate haul, and over 200 miles long haul. d. Business use: service, retail, commercial. The difference in rate for these could be substantial. e. The weight of the vehicle or the seating capacity for a vehicle used to carry passengers.

Section III - Physical Damage Coverage

a. The insurer will pay for a loss to a covered auto or its equipment under: 1) Comprehensive - Coverage includes physical damage to a covered auto or its equipment from any cause, except collision with another object or overturn. It does not cover wear and tear, mechanical breakdown, or blowouts. 2) Specified Causes of Loss - Coverage includes fire, lightning, explosion, theft, wind, hail, earthquake, flood, mischief or vandalism, and derailment of a conveying vehicle. This coverage does not include glass breakage. 3) Collision - Coverage includes colliding with another object or upset (overturn) of the auto. b. Towing - The insurer will pay, up to the limit shown in the Declarations, for towing and labor incurred each time a covered private passenger type auto is disabled. Labor must be performed at the place of disablement. c. Glass Breakage - Hitting a Bird or Animal - Falling Objects or Missiles - If the insured carries Comprehensive coverage, the insurer will pay for glass breakage, loss caused by hitting a bird or animal, and loss caused by falling objects or missiles. d. Coverage Extension - The insurer will pay up to $20 per day, and up to a maximum of $600, for temporary transportation expenses. Transportation expenses begin 48 hours after the theft of the vehicle. The insurer will also pay expenses for which the insured becomes legally responsible to pay for loss of use of a vehicle rented or hired as a result of physical damage to such vehicle.

Non-owned vehicles,

including autos owned by employees while being used in the business of the insured, may be insured as a separate category.