Definitions

Conditions

 Other Insurance — Primary and Excess Insurance Conditions

a.While any covered “auto” is hired or borrowed from you by another “motor carrier” this Coverage Form's liability coverage is:

(1)Primary if a written agreement between you as the lessor and the other “motor carrier” as the lessee requires you to hold the lessee harmless.

(2)Excess over any other collectible insurance if a written agreement between you as the lessor and the other “motor carrier” as the lessee does not require you to hold the lessee harmless.

b.While any covered “auto” is hired or borrowed by you from another “motor carrier” this Coverage Form's liability coverage is:

(1)Primary if a written agreement between the other “motor carrier” as the lessor and you as the lessee does not require the lessor to hold you harmless, and then only while the covered “auto” is used exclusively in your business as a “motor carrier” for hire.

(2)Excess over any other collectible insurance if a written agreement between the other “motor carrier” as the lessor and you as the lessee requires the lessor to hold you harmless.

c.While a covered “auto” which is a “trailer” is connected to a power unit, this Coverage Form's Liability Coverage is:

(1)Provided on the same basis, either primary or excess, as the liability coverage provided for the power unit if the power unit is a covered “auto”.

(2)Excess if the power unit is not a covered “auto”.

d.Any Trailer Interchange Coverage provided by this Coverage Form is primary for any covered “auto”.

e.Except as provided in paragraphs a., b., c., and d. above, this Coverage Form provides primary insurance for any covered “auto” you own and excess insurance for any covered “auto” you don't own.

f.For Hired Auto Physical Damage coverage, any covered “auto” you lease, hire, rent, or borrow is deemed to be a covered “auto” you own. However, any “auto” that is leased, hired, rented, or borrowed with a driver is not a covered “auto”.

g.Regardless of the provisions of paragraphs a., b., c., d., and e. above, this Coverage Form's Liability Coverage is primary for any liability assumed under an “insured contract”.

h.When this Coverage Form and any other Coverage Form or policy covers on the same basis, either excess or primary, we will pay only our share. Our share is the proportion that the Limit of Insurance of our Coverage Form bears to the total of the limits of all the Coverage Forms and policies covering on the same basis.

 Analysis

 This other insurance condition reflects the nature of the motor carrier business in that it is more detailed than the other insurance condition clause that is found on the business auto form. This is needed due to the possibly frequent interchange of equipment and vehicles among motor carriers and the insurance complications entailed by the combination of trailers and power units that may not be covered on the same basis.

 The first and second paragraphs in this clause apply to situations where the named insured interchanges covered autos with another motor carrier. Paragraph a. deals with the other motor carrier hiring or borrowing a covered auto from the named insured. Coverage provided by the named insured's motor carrier form is primary if the written agreement requires the named insured to hold the other motor carrier harmless; if the agreement does not require such action, the named insured's policy is considered as excess over any other collectible insurance. If there is no other collectible insurance, the named insured's coverage will drop down to become primary.

 Paragraph b. reflects the mirror image of paragraph a. in that it deals with the situation where the named insured hires or borrows a covered auto from another motor carrier. In this situation, the named insured's coverage form is primary if the written agreement between the named insured and the other motor carrier does not require the other motor carrier to hold the named insured harmless. Additionally, the named insured's coverage form is primary only while the covered auto is used exclusively in the named insured's business as a motor carrier for hire. Of course, again as the reverse of paragraph a., if the agreement does require the other motor carrier to hold the named insured harmless, the named insured's coverage form is considered excess over any other collectible insurance.

 Paragraph c. deals with trailers connected to a power unit. If the power unit is not a covered auto, the policy of the named insured provides excess coverage for the trailer. If the power unit is a covered auto, the primary or excess status of the coverage on the trailer is governed by the primary or excess status of the coverage on the power unit itself. As an example, if motor carrier A, the named insured, agrees to lend an owned covered trailer to motor carrier B to be pulled by one of B's tractors, the arrangement would result — from A's side — in a covered trailer's being attached to a power unit that is not a covered auto; A's policy therefore would provide excess coverage on the trailer borrowed by B. Assuming that B has a motor carrier coverage form, that form's liability coverage will be primary with respect to the borrowed trailer since, from B's point of view, a covered trailer is attached to a power unit that his or her policy covers on a primary basis. If, in this example, the equipment borrowed were not just a trailer but a combined tractor and trailer, A's liability insurance on the trailer would again be excess but for the reason, in this case, that the trailer is attached to a covered power unit (A's tractor lent to B) to which A's policy applies on an excess basis.

 Any trailer interchange coverage provided by CA 00 20 is primary for any covered auto. And, regardless of other provisions in the other insurance condition, the liability coverage is primary for any liability assumed under an insured contract.

 It should be noted that for hired auto physical damage coverage, any covered auto that the named insured leases, hires, rents, or borrows is deemed to be a covered auto owned by the named insured, thereby putting that particular auto on a primary basis. However, any auto that is hired or borrowed with a driver is not considered a covered auto under the motor carrier form and so, the issue of primary or excess status is not relevant.

 Except for the strictures that appear in the other paragraphs of the other insurance condition, paragraph e. states the usual point that the coverage is primary for covered autos owned by the named insured and excess for nonowned covered autos. Another usual point made in this condition is the one about pro-rata contribution in the event that two or more policies cover the same insured loss on the same basis.

 Definitions

 The definitions on the motor carrier form are the same as the ones on the business auto form except that the terms of the “insured contract” definition and the “trailer” definition are changed to a degree; also, there are two definitions that do not appear on the business auto form.

 The definition of “insured contract” is changed as follows:

 An “insured contract” does not include that part of any contract or agreement: