Direct and Accidental Damage

We have an insured who purchased a new vehicle in the summer of 2007. In the purchase agreement the insured opted to have the dealership put a protective sealant on the exterior and interior. The subcontractor completed this work before the vehicle was delivered.

In October of this year, the insured had the vehicle out in the rain. (The insured lives in southern California and this was the first time that it had rained since the purchase of the vehicle). After the rain the insured found that there were rain spots or what he referred to as “bleached out” areas on the vinyl/acrylic stripes that run over the vehicle (from hood to trunk). The insured has been attempting to work with the dealership and the subcontractor to take care of the situation.

The insured has now turned to us for assistance. Reviewing the file, the insured has had “Other than Collision” coverage and “Collision” coverage available for the vehicle from the date of purchase. However, after reviewing the file with multiple people, we don't see coverage. I can't find where this was a direct or accidental loss to the insured vehicle. Could you please advise under what circumstances this would or would not be a covered loss.

Washington Subscriber

From the insured's point of view, the loss to the vehicle was indeed accidental and direct. Something caused the spots to the vinyl/acrylic stripes, so there is direct damage there. It certainly was accidental in that the damage wasn't intended. Your issue isn't so much whether or not this is an “other than collision” loss, but is there a claim against the subcontractor who did the coating or the manufacturer who made the stripes? It's not clear from your description whether the cause of the loss was faulty stripes, faulty coating, or acid rain, or some combination of the three. We say you have an other than collision loss, and subrogation possibilities depending on the true cause of loss.

 

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