In addition, see the following exclusion: B. Exclusions 3. We will not pay for "loss" due and confined to: a. Wear and tear, freezing, mechanical or electrical breakdown. Does this exclusion apply?

Ohio Subscriber

We are of the opinion that the towing and labor costs wording means that the insurer will pay the $50 even if there is no towing involved. If the insured can have his car fixed at the spot of a breakdown and there is then no need for a tow, the labor is performed at the place of disablement as is required by the clause. On the other hand, if the car cannot be fixed at the place of disablement, there has to be a tow and there is no labor separate from the tow. So, if the insurer wanted to separate the two actions, the language should have been clearer. The insured is always entitled to the benefit of any reasonable doubt.

As for the exclusion, it does not apply for two reasons.

First, the exclusion applies to a loss as described in the insuring agreement. But, the towing clause is a separate agreement from the coverage for physical damage insuring agreement and the insured has paid a separate premium for the towing coverage. So, look at the physical damage coverage agreement and the towing agreement as two separate items. If the exclusion were to apply to both agreements, the exclusion should have said as much.

Second, the exclusion applies to a loss due and confined to a mechanical breakdown. That means that any consequential loss would not be covered by the exclusion. For example, if the tumbler in the ignition breaks due to a mechanical breakdown, that is not covered. But, if that then leads to a fire that destroys the engine or the entire car, the fire damage is covered because the exclusion applies only to the loss due and confined to the mechanical breakdown.

So, the coverage is there for the labor costs.