Acquired autos

Miscellaneous

Introduction

 The motor carrier coverage form follows in many respects the language of the truckers coverage form. As befits its purpose, however, the motor carrier form does present different provisions from the truckers form so as to fit coverage more precisely to the loss exposures faced by today's common, contract, and private motor carriers.

 The motor carrier coverage form makes use of a set of numerical symbols for designating which autos qualify as "covered autos", just as the truckers form does (and for that matter, just as the business auto and auto dealers forms do). Item two of the declarations (CA DS 21 10 13) is the schedule of coverages and covered autos. Symbols are entered next to a coverage on the declarations to show just which particular coverage is provided for which particular auto.

 Covered Autos

 61—Any "Auto"

 Analysis

 Symbol 61 makes any auto a covered auto, that is, the insured will have coverage for any auto that is owned, nonowned, hired, borrowed, or used by the named insured or in the insured's business. When symbol 61 is used, there is no need to indicate any other coverage symbol because symbol 61 encompasses all of them. Any auto that the insured acquires during the policy period is automatically covered and the insurer should pick up and charge for that exposure at the audit. From the insured's point of view, symbol 61 is clearly the best choice of coverage.

 62—Owned "Autos" Only

 Analysis

 This symbol applies to only the autos that the named insured owns (and for liability coverage any trailers that the named insured does not own while connected to a power unit the named insured does own). This includes those autos the named insured acquires ownership of after the policy begins. Symbol 62 provides no coverage for hired, borrowed, or nonowned autos. This symbol can be used for any coverages that are available under the motor carrier coverage form, depending on the circumstances. For example, it might be used for purposes of liability coverage when the insured does not wish to purchase nonowned autos coverage, which would be automatically included under symbol 61. More commonly, symbol 62 is used for providing "automatic" physical damage insurance on a fleet of owned autos.

 63—Owned Private Passenger Type "Autos" Only

 Analysis

 This symbol is for only the private passenger type autos owned by the named insured; this includes those private passenger type autos that the named insured acquires ownership of after the policy begins. Symbol 63 can be used for any coverage under the motor carrier form. For example, it might be used as an underwriting tool when an insurer is willing to cover a fleet of private passenger autos, but does not want to assume liability for larger vehicles that the insured might acquire during the policy period. An equally practical application might be for uninsured motorists coverage in a state where uninsured motorists coverage is not mandatory and the insured only wishes to have the coverage on its private passenger type vehicles.

 Symbol 63, in keeping with the nature and background of CA 00 20, notes that private passenger type autos owned by the named insured can be classified as covered autos. The term "private passenger type" is defined on the motor carrier form as a private passenger or station wagon type auto and includes an auto of the pickup or van type if not used for business purposes. This does not mean that pickups and vans used for business purposes can not be covered autos under the motor carrier form; for example, symbol "64″ applies to commercial autos, including trucks, and the commercial lines manual treats pickups and vans as trucks; so if the insured is using a van for motor carrier purposes, symbol "64″ would be proper to cover that exposure.

 64—Owned Commercial "Autos" Only

 Analysis

 Symbol 64 is for only those trucks, tractors, and trailers that the named insured owns (and for liability coverage any trailers the named insured does not own while connected to a power unit owned by the named insured). This includes those trucks, tractors, and trailers the named insured acquires ownership of after the policy begins. As noted above, this symbol can be applied to pickups and vans used for business purposes.

 65—Owned "Autos" Subject to No-Fault

 Analysis

 Symbol 65 applies only to those autos owned by the named insured that are required to have no-fault benefits in the state where they are licensed or principally garaged. This includes those autos that the named insured acquires ownership of after the policy begins provided they are subject to the no-fault law in the state where they are licensed or principally garaged. This symbol is not appropriate in states where the named insured has the right to buy no-fault coverage, but is not required to do so.

 66—Owned "Autos" Subject to a Compulsory Uninsured Motorists Law

 Analysis

 Symbol 66 is for only those autos that the named insured owns and that, because of the law in the state where they are licensed or principally garaged, are required to have and cannot reject uninsured motorists coverage.

 This includes those autos that the named insured acquires ownership of after the policy begins provided they are subject to the same state uninsured motorists requirement. Underinsured motorists coverage is included under the scope of this symbol.

 67—Specifically Described "Autos"

 Analysis

 Only those autos described in item three (3) of the declarations for which a premium charge is shown are covered under this symbol; and, for liability coverage, any trailers that the named insured does not own while attached to any power unit described in item three are also covered here. Obviously, the coverage provided through the use of symbol 67 is more restrictive than are other symbols of covered autos, such as 61 or even 62 or 63. If symbol 67 is used on the motor carrier form, only the specifically described auto(s) will be covered and if the insured uses another auto in his or her business, the form will not respond to a claim.

 68—Hired "Autos" Only

 Analysis

 This symbol is for only those autos that the named insured leases, hires, rents, or borrows. This does not include any private passenger type auto that the named insured leases, hires, rents, or borrows from any member of his or her household, any of his or her employees, partners (if the named insured is a partnership), members (if a limited liability company), or agents or members of their households. This symbol does allow coverage for autos other than those of the private passenger type that the named insured hires or borrows from an employee or a family member. This is, of course, in marked contrast with the hired auto coverage provided by the business auto coverage form, but this does recognize the risk exposures that motor carrier insureds face. So if the named insured finds himself or herself in the position of hiring or borrowing an employee's truck for motor carrier purposes (regardless of whether that course of action is merely occasional or constant), symbol 68 should be the chosen symbol for coverage.

 69—"Trailers" in Your Possession Under a Written Trailer or Equipment Interchange Agreement

 Analysis

Symbol 69 is for only those trailers that the named insured does not own while in the named insured's possession under a written trailer or equipment interchange agreement; this agreement must be one in which the named insured assumes liability for loss to the trailers while in his or her possession. A trailer interchange agreement is one used routinely in the motor carrier business and involves one carrier using the trailer of another based on economic or practical reasons. Incidentally, the motor carrier form does provide physical damage coverage for these nonowned trailers under section III of the form and symbol 69 must be used on the declarations page to designate such coverage.

 70—Your "Trailers" in the Possession of Anyone Else Under a Written Trailer Interchange Agreement

 Analysis

 This symbol acts as a complementary force to symbol 69. Just as symbol 69 provides coverage for the named insured who has another party's trailers in his or her possession, symbol 70 provides coverage for the named insured who allows another party to possess his or her trailers. Only those trailers the named insured owns or hires while in the possession of anyone else under a written trailer interchange agreement are covered here. When symbol "70″ is entered next to a physical damage coverage in item two (2) of the declarations, the physical damage coverage exclusion relating to loss to a trailer in the possession of anyone else does not apply to that coverage.

 71—Nonowned "Autos" Only

 Analysis

 Only those autos that the named insured does not own, lease, hire, rent, or borrow that are used in connection with the named insured's business are covered by this symbol. This includes private passenger type autos owned by the named insured's employees or partners (if the named insured is a partnership), members (if the named insured is a limited liability company), or members of their households but only while used in the named insured's business or personal affairs. Contrast this symbol with symbol 68, hired autos. Symbol 68 makes a point of not including private passenger type autos owned by employees or family members within its scope; symbol 71 makes a point of including such vehicles. This fits in with the nature of a motor carrier, in that a hired vehicle is, in most instances, meant to transport property and would not be, therefore, a private passenger type auto; while on the other hand, a nonowned auto (as defined on this coverage form) used in the insured's business is best exemplified by an employee using his or her private passenger type auto to run an errand or deliver some contractual paperwork—namely, used mainly as a vehicle transporting people.

 79—Mobile Equipment Subject To Compulsory Or Financial Responsibility or Other Motor Vehicle Insurance Law Only

 Analysis

 This symbol applies to only those autos that are land vehicles and that would qualify under the definition of mobile equipment under this policy except for the fact that they are subject to a compulsory or financial responsibility law, or other motor vehicle insurance law where such vehicles are licensed or principally garaged. Currently, such vehicles are considered as items having coverage under commercial auto policies, not the CGL form. This is in reaction to such states where uninsured motorists (UM) coverage is mandatory, and courts were requiring general liability insurers to pay UM claims for operators of mobile equipment who got involved in accidents while traveling on public roads.

 Acquired Autos

 1.If symbols 61, 62, 63, 64, 65, 66, or 79 are entered next to a coverage in Item Two of the Declarations, then you have coverage for "autos" that you acquire of the type described for the remainder of the policy period.

2.But, if symbol 67 is entered next to a coverage in Item Two of the Declarations, an "auto" you acquire will be a covered "auto" for that coverage only if:

a.We already cover all "autos" that you own for that coverage or it replaces an "auto" you previously owned that had that coverage; and

b.You tell us within 30 days after you acquire it that you want us to cover if for that coverage.

 Analysis

 CA 00 20 has clauses in the covered autos section dealing with owned autos acquired after the policy begins. The motor carrier form indicates that if symbols "61″, "62″, "63″, "64″, "65″, "66″, or "79″ are entered on the declarations page, then the named insured has coverage for autos that the named insured acquires of the type described for the remainder of the policy period. If symbol "67″ (specifically described autos) is used on the declarations page, an auto that the named insured acquires after the policy begins will be a covered auto for that coverage only under certain conditions: the insurance company must already cover all autos that the named insured owns for that specific coverage and the named insured must tell the company within 30 days after the acquisition of the auto that the named insured wants the insurer to cover the auto for that coverage.

 Miscellaneous