Our insured acquired a new car recently. He did not tell us about the new car until about one month after the acquisition. The insured has not been involved in an accident but he asked, for future reference, about the coverage for newly acquired autos that his personal auto policy provides. I have read the language on the personal auto policy, and I find it confusing as to the coverage the insured has for the new car. Can you help?

Illinois Subscriber

Here is the way the most current ISO personal auto policy handles coverage for newly acquired autos.

For any coverage except physical damage to the car, a newly acquired auto has the broadest coverage shown on the Dec page if the auto is a replacement for a vehicle that is already covered on the Dec page; no notice is required to the insurer if it is a replacement. If the newly acquired auto is in addition to any vehicle shown on the Dec page, the insured has coverage for fourteen days after he becomes the owner without a requirement to tell the insurer. However, if the insured wants coverage for this auto after the fourteen day period, he must tell the insurer. If the fourteen day period has elapsed, and the insured then tells the insurer about the newly acquired auto, coverage will start at the time of the request for coverage.

For collision coverage, the insured has such coverage for fourteen days after he becomes the owner if the dec page indicates that collision coverage applies to at least one auto. After the fourteen day period, the insured must tell the insurer of the vehicle and request coverage. If the insured does not have collision coverage on any vehicle and then acquires an auto, the fourteen day period is cut to four days. If a loss occurs within this four day period, the insured has coverage, but with a mandatory $500 deductible.

The other than collision coverage is handled the same way as the collision coverage for newly acquired autos.

The important point for the insured to remember is that, while he may have at least fourteen days coverage under the personal auto policy for liability and physical damage exposures, the better path is to tell his agent immediately after acquiring a new car. That action will help avoid coverage questions should an accident occur after the acquisition.

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