Chapter 9 - Policy Change Forms

Question 1

OPCF

Answer 1

Endorsements are used to make changes (that is, add or delete coverage) to insurance policies. The endorsements used to modify the OAP 1 are known as Ontario Policy Change Forms (OPCFs

Question 2

OPCF 2: Providing Coverage When Named Persons Drive Other Automobiles

Answer 2

OPCF 2: Providing Coverage When Named Persons Drive Other Automobiles extends the coverage in Section 2.2.3: Other Automobiles to persons named in the endorsement. Insureds can use this endorsement to prevent a shortfall in coverage, as OAP 1 limits these coverages specifically to the named insured and their spouse.

Question 3

OPCF 3: Drive Government Automobiles

Answer 3

OPCF 3: Drive Government Automobiles provides coverage for a person driving a vehicle owned by the Government of Canada or any province or territory of Canada. Government vehicles are exempt from the mandatory insurance requirements.

Question 4

OPCF 4A: Permission to Carry Explosives

Answer 4

OPCF 4A: Permission to Carry Explosives provides coverage to carry specified explosives. Normally, the OAP 1 specifically excludes coverage when the vehicle is used for such purposes.

Question 5

OPCF 4B: Permission to Carry Radioactive Material

Answer 5

Similar to OPCF 4A: Permission to Carry Explosives, OPCF 4B: Permission to Carry Radioactive Material grants permission to carry specified radioactive material.

Question 6

OPCF 5: Permission to Rent or Lease Automobiles and Extending Coverage to Specified Lessee(s)

Answer 6

OPCF 5: Permission to Rent or Lease Automobiles and Extending Coverage to Specified Lessee(s) provides coverage to the lessee as if the lessee were the named insured, and to every other person who uses or operates the automobile with the lessee’s consent.

This is a very important change to the policy wording; normally, only the registered owner should be the named insured. It is a lengthy endorsement that essentially changes all references within the policy from “you” to “the lessee.”

Question 7

OPCF 5C: Permission to Rent or Lease

Answer 7

OPCF 5C: Permission to Rent or Lease gives the lessor permission to lease the automobile to the applicant. The insurer agrees to indemnify the lessee and every person who, with the lessee’s consent, drives the automobile. OPCF 5C: Permission to Rent or Lease is for short-term leases only: the automobile cannot be leased or rented for more than 30 days to any one person.

Question 8

OPCF 5D: Conversion Coverage (Rented or Leased Automobiles)

Answer 8

OPCF 5D: Conversion Coverage (Rented or Leased Automobiles) is used for vehicles that are rented or leased. Remember, under Section 7: Loss or Damage Coverages (Optional), that the insurance company will not pay a claim resulting from a dishonest claim of ownership, illegal disposal, or theft of the automobile by anyone who has legal possession of it under a written agreement except a lease.

Question 9

OPCF 6A: Permission to Carry Paying Passengers

Answer 9

OPCF 6A: Permission to Carry Paying Passengers permits carrying passengers for compensation.

Question 10

OPCF 9: Marine Use Excluded

Answer 10

OPCF 9: Marine Use Excluded excludes loss or damage occurring while the automobile is on or in water or during the launching or landing process.

Question 11

OPCF 16: Suspension of Coverage *****

Answer 11

OPCF 16: Suspension of Coverage suspends certain coverages for a specific period of time (for example, suspend coverage during the winter months if the vehicle will not be driven).

Question 12

OPCF 17: Reinstatement of Coverage

Answer 12

As the name implies, OPCF 17: Reinstatement of Coverage reverses the suspension of OPCF 16: Suspension of Coverage and restores coverage.

Question 13

OPCF 19A: Agreed Value of Automobiles

Answer 13

OPCF 19A: Agreed Value of Automobiles is in reference to Section 7: Loss or Damage Coverages (Optional) and allows a described automobile to be insured on a valued basis. This could be used to insure classic, custom, or antique vehicles, etc.

Note: It’s important to learn the difference between OPCF 19: Limiting the Amount Paid for Loss or Damages and OPCF 19A: Agreed Value of Automobiles.

Question 14

OPCF 20: Coverage for Transportation Replacement

Answer 14

OPCF 20: Coverage for Transportation Replacement expands on Section 7.4.4: Loss of Use Due to Theft and provides replacement transportation for any insured loss under Section 7: Loss or Damage Coverages (Optional) that exceeds the deductible amount for any one claim.

It reimburses the insured for reasonable expenses incurred because of the loss of use of the insured automobile. These expenses could include the rental of a substitute vehicle or the costs of taxis or public transportation. Coverage is limited in some cases to a stated amount per day and a maximum amount per occurrence. The limit of coverage can differ with each company.

Question 15

OPCF 23A: Lienholder Protection

Answer 15

OPCF 23A: Lienholder Protection provides protection for the lienholder’s interest in the insured vehicle. If there is a claim for loss or damage to the described automobile in which the lienholder has an interest, and the claim is settled in the form of a payment instead of a repair or replacement, the payment will be made jointly to the insured and the lienholder.

The lienholder is also protected through notification of any deletion of physical damage coverages or of any cancellation of the policy by the insurer.

Question 16

OPCF 27: Liability for Damage to Non-Owned Automobile(s) and Providing Other Coverages When Insured Persons Drive Other Automobiles

Answer 16

OPCF 27: Liability for Damage to Non-Owned Automobile(s) and Providing Other Coverages When Insured Persons Drive Other Automobiles extends coverage for damage to a non-owned automobile (including its equipment) resulting from the care, custody, or control of the non-owned automobile by an insured person and persons named in the endorsement (for example, a rental vehicle).

Note: It is important to understand the full coverage provided in this endorsement.

Question 17

OPCF 28A: Excluded Driver

Answer 17

OPCF 28A: Excluded Driver allows for specific individuals to be excluded from coverage under the automobile policy, other than for certain accident benefits coverages. The excluded driver must sign this endorsement.

Question 18

OPCF 32: Use of Recreational Vehicles by Unlicensed Operators

Answer 18

OPCF 32: Use of Recreational Vehicles by Unlicensed Operators defines “recreational vehicles” as including snowmobiles, trail bikes, mini- automobiles, motor scooters, mini-cycles, snow planes, motorized toboggans, mopeds, and motor-assisted vehicles, all-terrain vehicles, dune buggies, or similar vehicles. It waives compliance with Statutory Condition 4(1) of the policy, which prohibits the insured, or anyone with the permission of the insured, from operating the insured vehicle unless authorized by law.

As a result, OPCF 32: Use of Recreational Vehicles by Unlicensed Operators would allow someone under the age of 16 to be insured while operating such a vehicle off a public highway.

Question 19

OPCF 38: Agreed Limit for Automobile Electronic Accessories and Equipment

Answer 19

OPCF 38: Agreed Limit for Automobile Electronic Accessories and Equipment limits the amount the insurer will pay for loss or damage to automobile electronic accessories and equipment other than factory-installed equipment to agreed amounts. This came into effect January 1, 2001.

Question 20

OPCF 43: Removing Depreciation Deduction

Answer 20

OPCF 43: Removing Depreciation Deduction means that, in the event of loss or damage to the insured automobile by an insured peril, the insurer agrees not to deduct for depreciation. The amount payable is limited to the lesser of: (1) the actual purchase price of the vehicle and its equipment, (2) the manufacturer’s suggested list price at the time of original purchase, or (3) the cost to replace the automobile with a new automobile of the same make and model, similarly equipped.

The insured must be the original purchaser of the automobile.

Question 21

OPCF 44R: Family Protection Endorsement

Answer 21

OPCF 44R: Family Protection Endorsement indemnifies an eligible claimant for the amount that they are legally entitled to recover from an inadequately insured or uninsured motorist as compensatory damages for bodily injury to or death of an insured person arising directly or indirectly from the use or operation of an automobile.

This endorsement exists on almost every policy sold in Ontario. The minimum limit of liability coverage in the province is $200,000, but almost anyone with an insurance policy will have coverage for an amount greater than the minimum (either $500,000 or $1,000,000). The endorsement is designed to provide the same level of protection to the insured and their family as the insured has provided to the public at large, with the liability limit shown on the insured’s policy.

If the insured is struck by an underinsured motorist carrying only $200,000 liability coverage, and the insured’s policy provides coverage up to $1,000,000 for legal liability, OPCF 44R: Family Protection Endorsement could be used to pay up to $800,000 — the difference between the insured’s limit of liability and the limit of liability on the underinsured motorist’s policy.

If the insured suffers a threshold injury in the above-mentioned collision and sues the underinsured motorist for $600,000, the underinsured motorist’s policy will pay only $200,000. Without this endorsement, that would be all the insured could recover. With this endorsement on the policy, the insured would collect the remaining $400,000, as if it were the underinsured motorist’s liability policy.

This endorsement can be used to pay up to the difference between an underinsured motorist’s policy and the insured’s policy liability limits for any incident of a similar nature.

This endorsement will also top up the amount recoverable under these circumstances when only $200,000 is recoverable under Section 5: Uninsured Automobile Coverage, or if the absolute liability provision applies due to the illegal or prohibited actions of the at-fault motorist.

Question 22

OPCF 48: Added Coverage to Offset Tort Deductibles

Answer 22

Under OPCF 48: Added Coverage to Offset Tort Deductibles, the insurer agrees to indemnify the insured for $10,000 for an insured person and $5,000 for a claimant under the Family Law Act for non-pecuniary claims (pain and suffering).