Ch.3 Lesson1 Intro41 to Bus. Auto

Lesson 1 of 2: Intro to Business Auto and Business Auto Acord 127 Chapter 3: Intro to Business Auto

Greg Rose Product Director State Auto Insurance Companies

Kris Kane Territory Manager State Auto Insurance Companies

Special Guest Speakers:

• You will learn how to identify the various types of business autos.
• You will understand Business Auto symbols 1-9 and 19
• You will learn how to complete a Business Auto ACORD application -ACORD 127You will review basics of a Garage Dealers Section ACORD 128
• You will be able to identify Small Business Vehicles vs Fleet VehiclesLesson 2 - Business Auto Coverage form CA 00 01 10 13
• You will understand Business Auto Policy (BAP) Terms and Definitions
• You will review the Business Auto Coverage ISO form CA 00 01 10 13 and learn how to identify, coverages, limitations, and exclusions

Learning Objectives

Intro to Business Auto & Business Auto ACORD 127

Learn to Identify the various types of Business Autos

• Owned autos
• Leased autos
• Hired autos
• Non-owned autos
• Certain types of mobile equipment

Even if the exposure is relatively simple, such as the office secretary driving her car to pick up supplies, the liability exposure is still significant because automobiles are capable of causing deadly results.Of the various commercial automobile coverage forms available, the Business Auto Coverage Form is the one most frequently used. It is designed to respond to the needs of most commercial vehicle exposures and has numerous endorsements that allow it to respond to special circumstances or requirements.

It's hard to imagine any commercial operation that does not have some type of automobile liability exposure. Some possible sources of loss that we will be discussing now are:

Truckers – Semi Tracker Trailers Garage Dealers – Auto Dealer open lot Mobile Equipment – Lift, boom truck & more Hired Auto – A vehicle you rent or lease under the business name, officer’s name or employees name for business use

Autos – including private passenger, pickup trucks, SUV’s and box trucks

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Non-Owned Auto – an automobile that is not owned by the small business owner but may be used such as a Pizza Delivery vehicle owned by the driver and not the business owner or Jimmy Johns Employee making deliveries in their own vehicle. Fleet of Vehicles-10 or more vehicles is considered a Fleet per ISOAdditional discount may apply when insuring a fleet of vehicles

Symbols 1-9 and 19

Let's Review

Business Auto Policy

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Arabic numerals (1–9 and 19 for business auto, 21–31 for garage, 41–50 and 59 for truckers, and 61–71 and 79 for motor carrier) used to denote to what category of autos a commercial auto policy's various coverages will apply. Symbols 10 (business auto), 32 (garage), 51 and 52 (truckers), and 72 and 73 (motor carrier) are custom symbols, available through the use of the covered autos designation symbol endorsement (CA 99 54), which allows the insurer and named insured to agree to some modified wording that is a better fit in defining the term "covered autos" for the policy in question.

What are Auto Coverage Symbols?

In this lesson we are going to review the covered auto designation symbols in the BAP which are numerals ranging from 1 through 9 and 19.

Covered auto symbols

Which are crucial in defining the policy's scope of coverage, appear in the declarations page of the auto policy next to each coverage purchased in the policy (e.g., liability, personal injury protection (PIP), auto medical payments, and uninsured and underinsured motorists (UM/UIM)). The symbols reflect the named insured's selection as to what types of vehicles are insured for that coverage (e.g., owned autos, hired autos, non-owned autos). Unless there is a coverage symbol shown beside the coverage name, the coverage will not apply.And unless the correct coverage symbol is shown, the insured may be without coverage that it intended to have. We will review the Business Auto coverage form in Lesson 2.

Info

subject to No Fault

05

Owned Autos

other than Private Passenger

04

Owned Auto’s

Autos that you own

03

Only Private Passenger

excludes hired, non owned

02

Only Owned Auto

Any Auto is a covered auto

01

Any Auto

subject to compulsory motorist law

19

Mobile Equipment

(Employees, Members of LLC, Members of household while conducting your business)

09

Non-Owned Auto’s

(Leased, hired or borrowed) Enterprise, Hertz

08

Hired Autos

(Only those specifically described are covered) No newly acquired Autos

07

Specified Described Autos

Regulation to UM

06

Auto You Owned

For #1, Premium will be shared for Hired/Nonowned

HANDOUT for you to use as a resource when selling business auto policies

Info

Automobile Financial Responsibility Laws by State

The Auto Dealers coverage will not be covered in depth in this lesson as there are many factors Garage Dealers, Garage Liability, Garage keepers all relates to; auto dealers, garages, repair shops and service stations. It is important to know that similar to Symbols 1-9 as we discussed with respect to Auto Dealer coverages forms the symbols numbers range from 21 through 31, 21 -29 corresponding with symbols 1 through 9 of the business auto coverage form. Symbol 30 designates garage keepers coverage and symbol 31 deals with auto physical damage coverages.

Trailers – must have a load capacity of 3,000 GVW (gross weight vehicle) or less and be designed primarily for travel on public roads. Trailers with capacity of over 3,000 GVW should be charged a premium.

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Garagekeepers Coverage is appropriate for any operation that accepts custody and control of vehicles belonging to third parties for a fee. This endorsement is needed because general liability coverage excludes property damage coverage for automobiles and other property in the named insured’s care, custody, and control. Automobile coverage forms also excludes care, custody and control

On the Declaration page, you will see the symbols next to the coverages afforded

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Auto Dealers ACORD 128 – will be discussed briefly later in this lesson

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Let’s talk about obtaining MVR’s on drivers and how that information may not be disclosed to others.

• You can have the carrier run the MVR’s
• If the agent Run’s MVR’s you must follow the regulations regarding disclosure of information.

MVR’s

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Vehicles Insured Elsewhere? Modified special equipment? Might have customized delivery trucks with business information on the truck need to know the cost of the customization and which vehicle describe has customization. Are ICC Interstate Commerce Commission, PUC Public Utility Commission or other Filings required? Do they cross state lines? Hazardous material?

In the United States, a utilities commission, utility regulatory commission (URC),public utilities commission (PUC) or public service commission (PSC) is a governing body that regulates the rates and services of a public utility. Small Business Coverage Specialist (nationalunderwriter.com)

DEFINITION of 'Interstate Commerce Commission - ICC' A body within the U.S. Department of Congress, charged with regulating the pricing of the movement of goods across state lines.

In the United States, a utilities commission, utility regulatory commission (URC),public utilities commission (PUC) or public service commission (PSC) is a governing body that regulates the rates and services of a public utility. Small Business Coverage Specialist (nationalunderwriter.com)

DEFINITION of 'Interstate Commerce Commission - ICC' A body within the U.S. Department of Congress, charged with regulating the pricing of the movement of goods across state lines.