Many people own and require insurance for vehicles that are nottypical private passenger automobiles, but are not commercialvehicles either. The Insurance Services Office (ISO) PersonalVehicle Manual contains rules (rule 19) and forms (PP 03 23 formost; PP 03 20 for snowmobiles) defining these vehicles forcoverage purposes. Of course, while ISO sets a standard, individualinsurers may deviate from it.

Motor Homes

The ISO rules manual says that a motor home isa self-propelled motor vehicle equipped with a “living area that isan integral part of the vehicle chassis.” A motor home typicallyhas plumbing, as well as facilities for cooking, refrigeration,dining, and sleeping.

A motor home that the insured drives to work or in business israted—for liability coverage—as a private passenger automobile. Apleasure use motor home receives a 50 percent reduction from thestandard private passenger auto rates for liability, medicalpayments/no-fault, and uninsured/underinsured motoristscoverages.

In order to rate physical damage coverage, the agent and insuredmust arrive at a stated amount of coverage. In order to properlyrate physical damage coverage, a symbol is assigned. The ISO SymbolManual provides a chart for converting a dollar amount to a symbol.Symbols are based on both the cost new of the vehicle and aparticular car’s damageability. Again, any motor home that theinsured drives to work or in business is rated like a privatepassenger auto. For a pleasure use motor home, the physical damagerate is 35 percent that of a private passenger auto.

When a motor home is insured under a personal auto policy, boththe Miscellaneous Vehicle Type Endorsement PP 03 23 and theMiscellaneous Type Vehicle Amendment (Motor Homes) (PP 03 28) arenormally used. The amendment excludes coverage when the motor homeis rented to others unless an additional premium is shown in theendorsement for coverages that apply during a rental. If the annualrental period is four weeks or less, the premium is increased by 50percent; for more than four weeks, the increase is 100 percent.

Trailers and Camper Bodies

A recreational trailer, as referred to in the ISO manual, like amotor home, is equipped with living quarters. A camper body, whichalso has living quarters, is a unit transported by a pickup. Incontrast to motor homes, these are not self-propelled vehicles.

Any personal auto policy that affords liability coverageprovides the same coverage for trailers designed for use with aprivate passenger auto, pickup, or van. There is no additionalpremium for this coverage and no description of the trailer isnecessary.

Physical damage coverage for a travel trailer or a camper bodymust be purchased. To be eligible, the insured must maintain a“permanent residence other than the recreational trailer.”Comprehensive and collision rates are the same for recreationaltrailers and camper bodies as for motor homes.

Physical damage coverage may also be provided under this formfor boat trailers, utility trailers, horse trailers, and othertrailers that do not contain living quarters, using rates shown inthe rating manual.

Motorcycles and Other SimilarVehicles Not Used for Business Purposes

The rating for liability coverage for thesevehicles is based on the size of the engine and the age of theoperators. If the insured chooses the passenger hazard exclusion(eliminating liability coverage for injuries to passengers), thesplit limit rate is reduced by 40 percent and the single limit rateby 20 percent. Uninsured motorists coverage is 200 percent of theapplicable private passenger rate.

Physical damage rates are based on the symbol 2 (for the modelyears 1990 and later) or symbol 7 (for model years 1989 andprevious) rates, depending on the vehicle’s age. A factor is thenapplied to that rate based on the cost new of the vehicle and theage of the operators. A higher rate applies if any operators areunder age twenty-five.

Snowmobiles and All-TerrainVehicles

The rules manual says that a snowmobile is “amotor vehicle designed for use principally on snow or ice, usingwheels or crawler-type treads or belts for locomotion across land,ice or snow.” The definition does not include a vehicle usingairplane type propellers or fans. Form PP 03 20, which is used toprovide snowmobile coverage, also includes within the definitionany trailer designed to be pulled by a snowmobile. A trailer usedto transport the snowmobile itself is not covered by this form.

The rules also define an all-terrain vehicle as “a four or sixwheel motor vehicle equipped with balloon tires or crawler treads,designed for use on rugged terrain or rugged terrain andwater.”

Liability coverage for either snowmobiles or all-terrainvehicles is rated at 50 percent of the applicable private passengerbase rate for a territory. The rate reduction contemplates seasonalusage. Thus, the insured may not add and remove liability coverage.As with motorcycles, the insured may reduce his liability premiumby choosing to exclude the passenger hazard. The reduction is,again, 40 percent for split limits and 20 percent for singlelimits.

Medical payments coverage of $1,000 is available. The rate is200 percent of the private passenger rate. Uninsured motoristscoverage is available at the private passenger rate.

Physical damage rates are based on the cost new of the vehicleand the deductible. A stated amount is selected for the vehicle.Then, a rate per $100 of value is applied.

Dune Buggies

The rules manual says that a dune buggy is “amotor vehicle of the private passenger type designed or modifiedfor use principally off public roads.” As with all-terrainvehicles, the liability rate for nonregistered dune buggies (90percent of the private passenger rate) already contemplatesseasonal use. Registered dune buggies are classified as privatepassenger vehicles. The same rate reduction applies for exclusionof the passenger hazard. Medical payments and uninsured motoristscoverage are available at the private passenger rate.

Physical damage rates are based on the cost new of the vehicleand the deductible. A stated amount is selected for the vehicle.Then, a rate per $100 of value is applied.

Golf Carts

The ISO rules define a golf cart as “a threeor four wheel motor vehicle with limited speed capabilitiesdesigned to carry golfers and their equipment around a golfcourse.” At least one insurer also covers golf carts while beingdriven to and from a golf course.

As with all-terrain vehicles, the liability rate (25 percent ofthe private passenger rate) already contemplates seasonal use.However, since the rules say nothing about medical payments oruninsured motorists coverage for golf carts, it appears that thosecoverages are not available.

Physical damage rates are based on the cost new of the vehicleand the deductible. A stated amount is selected for the vehicle.Then, a rate per $100 of value is applied.

Antique and Classic Autos

For insurance purposes, an antique auto is aprivate passenger auto that is twenty-five or more years old andmaintained “primarily for use in exhibitions, club activities,parades and other functions of public interest, and occasionallyused for other purposes.” As with all-terrain vehicles, theliability rate (40 percent of the private passenger rate) alreadycontemplates seasonal use. Medical payments, uninsured motoristscoverage, and no-fault are the same as the applicable privatepassenger rates. Physical damage coverage is on a stated amountbasis.

A classic auto is a private passenger motor vehicle that is tenor more years old and “may be used on a regular basis.” The manualstates that the value of a classic auto is “significantly higherthan the average value of other autos” of the same make and year.Liability, medical payments, and uninsured motorists coverages arerated the same as a private passenger auto. The physical damagecoverage is on a stated amount basis. The amount of value isconverted to a symbol and the rate for the current model yearapplies.

Using the rate for the current model year along with a statedamount helps the insurer collect a premium commensurate with theexposure. The unendorsed PAP settles physical damage losses on anactual cash value (ACV) basis, but the ACV of a ten-year-old car ingood condition may be considerably more than the original symboland model year of the car now contemplate. By rating a classic autoas current model year the insurer is obtaining a premium more inline with the exposure of a more valuable car. The use of a statedamount limits the insurer’s top-end payout in the event of a totalloss.

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