8.5 Transportation Expenses Copy
The personal auto policy offers payment for transportation expenses in addition to the payments made for physical damage to the insured’s car. The transportation payments are made without the application of a deductible. This section of the PAP applies to temporary transportation expenses incurred by the named insured due to loss to a covered auto.
Towing coverage is available with the attachment of an endorsement.
This coverage reimburses the insured for towing and labor cost resulting from disablement of an auto. There are limits of $40, $80, AND $120.
If the loss to the covered auto or to the non-owned auto is caused by a total theft, the transportation expenses clause does not apply until 48 hours after the theft, and the expenses end when the covered auto or non-owned auto is returned to use or the insurer pays for the theft loss.
The 48-hour waiting period is used in order to allow the insurer to make sure that the auto has indeed been stolen. The thinking here is that if the intent has been to steal the car, it will not turn up in 48 hours; this, as opposed to the idea that if there were no intent to steal the car but just use it for a joy ride, the car will be abandoned and found soon after it was taken.
The insurer will pay up to $20 per day subject to a $600 maximum this limit can be increased by endorsement.
Physical Damage Coverage Exclusions
The physical damage section of the PAP has 14 exclusions.
- Public or Livery Exclusion: The first exclusion deals with damage to the covered auto or any non-owned auto that occurs while the car is being used as a public or livery conveyance.
- Wear and Tear Exclusion: The second exclusion affects payments for damage due and confined to wear and tear, freezing, mechanical or electrical breakdown or failure, or road damage to tires.
- War and Nuclear Exclusion: The third exclusion on the physical damage part of the PAP is for loss due to or as a consequence of radioactive contamination, the discharge of any nuclear weapon war or rebellion.
Electronic Equipment Exclusions
The fourth, fifth, and sixth exclusions deal with loss to electronic equipment, tapes, discs, or other media used with electronic equipment. Although these exclusions are similar in their tone, they deserve separate discussions. - The Fourth Exclusion applies to a loss to any electronic equipment designed for the reproduction of sound and any accessories used with such equipment. This designation includes such things as radios and stereos, tape decks, and compact disc players. The exclusion has an exception for equipment that is permanently installed in the insured auto.
- Exclusion Five applies to loss to any citizens band radio, two-way mobile radio, telephone, scanning monitor receiver, personal computer, television, video cassette recorder, or any other electronic equipment that receives or transmits audio, visual, or data signals. The exceptions to this exclusion deal with electronic equipment that is necessary for the normal operation of the auto, and with permanently installed telephones designed to be operated by use of the power from the car’s electrical system.
- Exclusion Six, Recording Media Exclusion, pertains to loss to tapes, records, discs, or other media used with equipment described in exclusions four and five. This exclusion reinforces the point that items like tapes or discs are just too vulnerable to a theft loss or a mysterious disappearance for the personal auto policy premium to adequately cover the exposure. There is an endorsement that can be added to the PAP that applies to direct and accidental loss to tapes, records, and discs.
Trailers, Campers, Mobile Homes Exclusion - Exclusion Seven applies to a total loss to the covered auto or a non-owned auto due to destruction or confiscation by governmental or civil authorities. This exclusion relates to the increasing frequency of government confiscation of vehicles due to the illegal activities of the owner or driver, such as drug dealing or drunk driving.
Trailers, Campers, Mobile Homes Exclusion - Exclusion Eight on the physical damage part of the PAP deals with a loss to a trailer, camper body, or motor home that is not shown in the declarations. The flip side of this exclusion is that trailers, camper bodies, and motor homes can be covered autos under the personal auto policy’s physical damage section, but such vehicles have to be shown on the declarations page of the PAP for that coverage. The reason is that such vehicles offer their own particular set of exposures for a loss and a proper premium has to be charged in order to cover those exposures. The exclusion does not apply to trailers not owned by the named insured, or to trailers or camper bodies that the named insured acquires during the policy period and asks the insurer to cover within 14 days after the named insured becomes the owner.
“Reasonable Belief” Exclusion - Exclusion Nine is for loss to any non-owned auto when used by the named insured or any family member without a reasonable belief that the named insured or that family member is entitled to do so. The exclusion is limited to non-owned autos and is subject to a case-by-case interpretation of the phrase “without a reasonable belief”.
Radar Detection Equipment Exclusion - The Tenth Exclusion is for loss to equipment designed or used for the detection or location of radar or laser. Coverage for such equipment would not seem to mesh with public policy or an insurer’s wish that an insured driver obeys the speed limit.
Custom Furnishings Exclusion - The next exclusion applies to loss to any custom furnishings or equipment in or upon any pickup or van; custom equipment in private passenger type cars is not mentioned. Note that the exclusion can apply to items other than those listed in the exclusion itself; the listed items are special carpeting and insulation, furniture, bars, height-extending roofs, custom murals, paintings, or other decals or graphics. Note that collision coverage and other than collision coverage for customizing equipment can be arranged by endorsement.
Business Use Exclusion - A restriction on coverage for a non-owned auto being used in a business is the aim of exclusion twelve. there is no physical damage coverage whatsoever for any non-owned auto being maintained or used by any person while employed or otherwise engaged in a business of selling, repairing, servicing, storing, or parking of vehicles designed for use on public highways; this includes road testing and delivery.
Racing Exclusion - Under the provisions of exclusion thirteen, the insurer will not pay for physical damage loss to the named insured’s covered auto or any non-owned auto located inside a facility designed for racing for the purpose of competing in or practicing or preparing for any prearranged or organized racing or speed contest.
Rental Cars Exclusion - The last exclusion under the physical damage part of the personal auto policy is for loss to, or loss of use of, a non-owned auto rented by the named insured or any family member if a rental vehicle company is precluded from recovering such loss or loss of use pursuant with provisions of any rental agreement or state law.
