We offer a stand alone nonowned auto policy with worldwide coverage. We are curious as to what other companies offer in this field and have some questions. Are stand alone policies the standard? Is nonowned auto coverage offered through the general liability form? And is the coverage worldwide or is the coverage strictly limited to the U.S. and Canada ?

North Dakota Subscriber

You should know that many insurers either use their own auto forms or use the Insurance Services Office (ISO) forms and then revise the forms to suit the individual company underwriting policies. We can offer some answers to you based on the ISO forms, but be aware that individual insurers can use their own forms.

The only auto coverage that the ISO CGL form supplies is found in the exception to the auto exclusion. This exception offers coverage for autos that an insured does not own, operate, rent, or borrows. There is coverage specifically listed for parking an auto on the premises owned by the named insured, provided the auto is not owned by or rented or loaned to any insured. The bottom line is that the CGL form does offer some limited nonowned auto coverage, but if an insured really needs nonowned auto coverage, he should consider getting it from an auto policy. The coverage under the CGL form is for the U.S., Puerto Rico, and Canada in general. The worldwide coverage is for injury or damage arising out of the goods or products made or sold by the named insured, or from the activities of a person whose home is in the U.S., Puerto Rico, or Canada, but who is away for a short time on the named insured's business, like a traveling salesman or a CEO.

ISO really prefers to have auto coverage on its auto policy as opposed to the CGL form. The auto policy offers nonowned auto coverage through the use of the designated symbol 9. If this symbol is used, the insured has coverage for autos that the named insured does not own, lease, hire, rent, or borrow that are used in connection with the named insured's business. The coverage territory is the U.S., Puerto Rico, and Canada . There is worldwide coverage but this is if the covered auto of the private passenger type is hired, leased, rented, or borrowed without a driver for a period of 30 days or less. Notice that this is not the description of the covered auto under symbol 9 of the auto policy; it is symbol 8, hired autos. So, if the named insured has symbol 9 on the auto policy, there is a possibility that the insurer can claim there is no worldwide coverage should the insured rent a car overseas. But, if some other entity rents a car overseas to be used on the named insured's business and the named insured is somehow brought into a lawsuit after an auto accident, then the auto policy would offer worldwide coverage for the named insured. Of course, the responsibility to pay would have to be determined in a lawsuit filed in the U.S., Puerto Rico, or Canada .

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