Is damage caused by the wrong auto fuel a covered loss?
Coverage Q&A: A truck's engine suffered a mechanical breakdown after being fueled with regular gas instead of diesel.
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Editor’s Note: In this week’s question, a truck engine seized, but the insured’s policy excludes mechanical breakdown.
Question: An employee of the insured introduced regular fuel instead of diesel fuel into the tank of the insured’s 2020 Ford F-250 truck. As a result of the regular fuel, the engine seized. The only damages are to the engine, and the repairs cost $7,000. The CA 00 01 10 13 Business Auto Coverage Form provides physical damage coverage “from any cause except the covered auto’s collision with another object or the covered auto’s overturn.”
However, one exclusion states, ”We will not pay for ‘loss’ due and confined to: a. wear and tear, freezing, mechanical or electrical breakdown.” The question is, can we find coverage for this loss?? The policy also contains the CA-500 Business Auto Premier Endorsement, but no language appears to provide coverage for this event.
— Georgia Subscriber
Analysis: When looking at a loss, it is important to establish the actual cause of the loss. Some situations may appear to be excluded, but the cause of the loss can sometimes negate a policy exclusion upon further review. What caused the engine to seize could be the difference between coverage or the loss being excluded.
Answer: To learn the answer to this week’s coverage Q&A, please log into your FC&S Expert Coverage Interpretation account.
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