Limit of insurance

Deductible

Coverage

1.     We will pay for "loss" to a covered "auto" or its equipment under:

a. Comprehensive Coverage.

From any cause except:

(1)     The covered "auto's" collision with another object; or

(2)     The covered "auto's" overturn.

b. Specified Causes of Loss Coverage Caused by:

(1)     Fire, lightning, or explosion;

(2)     Theft;

(3)     Windstorm, hail, or earthquake;

(4)     Flood;

(5)     Mischief or vandalism; or

(6)     The sinking, burning, collision, or derailment of any conveyance transporting the covered "auto".

c. Collision Coverage.

Caused by:

(1)     The covered "auto's" collision with another object; or

(2)     The covered "auto's" overturn.

 Analysis:

The physical damage insuring agreement of the business auto coverage form states that the insurer will pay for loss to a covered auto or its equipment under any of three coverage choices: comprehensive, specified causes of loss, or collision. Note that none of these choices will be in effect unless a covered auto designation symbol or symbols are listed in item two of the policy declarations beside each coverage that the named insured desires.

When comprehensive coverage is selected, the insurer will pay for loss from any cause except the covered auto's collision with another object or its overturn. As an alternative to comprehensive coverage, coverage against a group of specified causes of loss can be purchased instead. These perils are fire, lightning, or explosion; theft; windstorm, hail, or earthquake; flood; mischief or vandalism; and the sinking, burning, collision, or derailment of any conveyance transporting the covered auto.

By the use of endorsement CA 99 14, the named insured can select any of four different packages of specified perils: (1) fire, (2) fire and theft, (3) fire, theft, and windstorm and (4) limited specified causes of loss. The first three packages also cover loss by lightning, explosion or by the sinking, burning, collision, or derailment of any conveyance transporting the covered auto. The fire, theft, and windstorm package and the limited specified causes of loss coverage include all of the above plus loss by hail or earthquake; the limited specified causes of loss package goes on to include loss by flood.

Collision coverage, if purchased, insures against loss caused by the covered auto's collision with another object or its overturn. Some physical damage forms used prior to the current business auto form have defined collision as including "upset," rather than "overturn." With respect to collision insurance, both terms have the same meaning. Courts have consistently held that overturn or upset takes place upon a vehicle's loss of equilibrium; the vehicle need not "roll over" or come to rest on its side or roof.

The North Dakota supreme court case of Williams v. Niesen, 261 N.W.2d 401 (1977), illustrates this principle. The loss involved a tractor trailer unit being used to transport cattle. While the unit was enroute to its destination, the left wheels of the trailer slid into a ditch causing the trailer to tilt at a 45 degree angle or more and the right wheels of the trailer to leave the ground; however, the trailer did not fall on its side. As a result of the tilting, the upper deck of the trailer collapsed and some of the cattle were killed. The court held that the death of the cattle was proximately caused by "overturn of the vehicle." The decision contains a detailed summary of other cases involving overturn and upset of vehicles.

In the case of collision, the vehicle must actually collide with a vehicle or an object. While there are many interpretations of terms when they are undefined in the policy, courts will turn to a standard desk reference for meaning. While there are variations, in general the definitions are alike in that collision involves two objects striking each other in some way.

However, there are at least two initial rules that may help in determining whether a loss is properly characterized as a collision loss. First, the insured automobile need not be in motion. Second, the collision need not be with another automobile. Unfortunately, these two rules do not serve as instant and resolute clarification of the issue in every claim situation. As the Court of Appeals of Kentucky noted in Calvert Fire Insurance Company v. Little, 421 S.W.2d 584 (Ky. 1967), ". . . the word 'collision' is susceptible of various constructions." The definition of the term in the auto policy does offer some guidelines by which these various constructions can be made, but enough truly murky loss situations do exist so as to keep the question "what is collision?" open to discussion.