Insurance coverage Q and A: Third-party injured during tire change by covered towing company

When an injury occurs at the scene of a roadside repair, which commercial policy provides coverage if a stranded motorist is hurt?

During a routine tire change, a customer assisting with the process was injured when the vehicle fell off a standard jack, presenting a unique commercial coverage question. Credit: madscinbca/Adobe Stock

PropertyCasualty360.com editor’s note: Every claim is different, and some insurance policies can be difficult to interpret for unique situations. FC&S Expert Coverage Interpretation, the recognized authority on insurance coverage interpretation and analysis for the P&C industry, makes it simple to find credible answers to your complicated coverage questions. The following letter was edited for length and clarity. 

We issue a standard business auto policy to a towing company with the repair plate endorsement (registration plates not issued to a specific auto). AAA is called by a customer with a flat tire and our client is dispatched to go assist with the repair.

The insured takes the covered vehicle to the scene and takes a “jack” to the disabled vehicle. This is a standard jack and clearly not attached to the vehicle. The driver lifts the vehicle up and takes the flat tire off. When he goes to put on a new tire, he realizes the car is not lifted high enough. The policyholder jacks the disabled vehicle up a bit more, but the car falls off the jack and injures the customer’s hand, who is assisting for some unknown reason.

What policy responds: Commercial auto or would this more go towards a “garage” policy?

Massachusetts Subscriber

We were provided the endorsement which shows that the registered plates coverage makes any towing vehicle the insured owns or operates a covered “auto.” So the question then becomes, is the disabled customer vehicle a covered “auto,” which it is not.

The disabled customer vehicle is not a covered “auto” under the policy. The business auto coverage form CA 00 01 provides liability coverage for sums, stating an insured must legally pay for bodily injury or property damage caused by an “accident” and resulting from the maintenance or use of a covered “auto.” Since the description of the loss is not from the insured’s covered “auto,” but rather from equipment used in their towing operations, then this will be a general liability claim as opposed to an auto claim.

The towing company’s agreement to service the disabled customer vehicle qualifies as an “insured contract” under the general liability coverage form CG 00 01, item f., which is a contract or agreement under which the insured assumes the tort liability of another party to pay for “bodily injury” or “property damage” to a third person or organization. Tort liability is liability that would be imposed by law even if there were no contract or agreement.

In this situation, the customer sustained “bodily injury” from the operations of the towing company. Even if there was no contractual agreement, since the equipment that caused the injury was owned by the insured and used in their operations, there should be coverage for the customer’s bodily injury.

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