Commercial Auto

Question 1

Property Exposures

Answer 1

1) Damage or Destruction of Vehicle
- Decrease in or loss of value
- Loss of use of auto until replaced

Question 2

Owned Auto

Answer 2

• Owner or EE operates an auto owned by business
• Respondent Superior
• Assumes EE acting on ER behalf
• Covers loaner vehicles; temporarily replaces vehicle, not a rental

Question 3

Respondent Superior

Answer 3

Let the ER Answer

Question 4

Autos Not Owned by User

Answer 4

• Might have EE rent vehicles

- Might have vehicles in care; Bailee using vehicle

Question 5

Hired/Borrowed Autos

Answer 5

• Some lease vehicles

Question 6

Liability Assumed Under Contract

Answer 6

• Hold Harmless Agreement
• Might already be covered in another section
• Extra provision might require additional damages (rental, replacement, etc)

Question 7

ER Non Ownership Liability

Answer 7

• ER use own cars in job duties
• Policy attached to car responds first
• Since furthering business interest, cold be held liable

Question 8

Business Auto Coverage Form

Answer 8

• Covers auto loss exposures for a business
• Excludes dealers and motor carrier
• Business auto declaration form is longer and more detailed than most other coverage forms

Question 9

Business Auto Coverage Form: Section 1

Answer 9

• Lots of Flexibility
• Liability on some and full coverage on others
• Coverage Symbol - numerical symbol on policy for each auto

Question 10

Newly Acquired Auto

Answer 10

• Symbol 1 through 6; no need to notify insurer, coverage applies till the end of policy
• Symbol 7; cover if insurer insures all autos owned by a named insured or new auto replaces a previously covered auto, named insured asks insurer to cover auto within 40 days of acquisition

Question 11

Section II

Answer 11

• Liability
• Bodily injury and property damage to others
• Covered pollution cost/expense; some pollution expenses covered, must be part of accident that also results in bodily inures or property damage that would be covered by the policy
• Duty to defend

Question 12

Section II: out of State Coverage Exceptions

Answer 12

• Vehicle travels in state with higher minimum; policy limits match that new minim while in state
• Coverage is mandatory in different state that it applies while in state

Question 13

Exclusions

Answer 13

• Intended Injury
• WC
• Property in care, custody or control (Inland Marine)
• War
• Racing

Question 14

Section III

Answer 14

• Physical Damage
  1) Collision: striking vehicle violently, overturn
  2) Comprehensive: Any damage to vehicle; except collision or peril specifically excluded
  3) Towing and Labor: Reimburse for toward and labor expenses from the disablement of a private passenger auto
  4) Transportation Expenses: Substitute transportation expenses when a private passenger vehicle is disabled

Question 15

Section III: Exclusions

Answer 15

• Nuclear hazards, war, military action
• War and tear, freezing, mechanical and electrical failure, road damage to tires
• Tapes, records, discs and similar devices
• Radar Detectors
• Diminution in value: actual or perceived loss in value from damaged property being repaired

Question 16

Section III: Garage Coverage Form

Answer 16

• Covers auto and liability loss exposures of auto dealers
• As of 202 ISO form does not include auto service operations; CGL as endorsements
• Many still exclude in garage form: repair shops, service stations parking garages, tow truck operators

Question 17

Section III Garage Keepers Coverage

Answer 17

• Damage left to auto in insured’s care
• attending
• Servicing
• Repairing
• Parking
• Storing

Question 18

Garage Coverage Form: Direct Excess Option

Answer 18

• Will pay when insured is legally liable as primary

- When not liable will pay as excess after what customer can recover from their own policy

Question 19

Garage Coverage Form: Direct Primary Option

Answer 19

• Will pay regardless of liability or existence of coverage by customer

Question 20

Section IV

Answer 20

• Physical Damage

Question 21

Section IV: Dealer’s Auto

Answer 21

• Not listed individually but in the aggregate

- Single overall limit

Question 22

Section IV: Exclusions

Answer 22

• False Pretenses: Voluntary part with via truck, scheme, or other fraudulent means
• Drive-away: No collision coverage for auto being driven from point of purchase to destination over 50 miles; don’t want EE to use for personal use; limits use

Question 23

Motor Carrier Coverage Form

Answer 23

• Used to known as Truckers Form
• Covers businesses that use autos to transport property of others or their own
• Owner Operators: independent contractors hired to haul goods for owner
• Motor Carrier: often providers liability coverage for owner operator during trip

Question 24

Motor Carrier Gap In Coverage

Answer 24

When picking up goods or empty

Question 25

Bobtail

Answer 25

Truck power unit without attached trailer

Question 26

Deadheading

Answer 26

Operating with an empty trailer

Question 27

Bobtail and Deadheading Insurance

Answer 27

Usually not covered under Motor Carrier

- Both provide liability when not carrying goods for client

Question 28

Trailer Interchange

Answer 28

• When motor carrier agrees to swap trailers with another carrier
• Usually agree to indemnify the other carrier if damage occurs to borrowed trailer
• Trailer interchange coverage addressed this created liability