May 13, 2013

How does non-owned and hired automobile liability coverage apply under the commercial general liability policy?

Kentucky Subscriber

The current CGL form does not provide coverage for nonowned and hired car liability in that exclusion (g) excludes coverage for BI or PD arising out of the ownership, maintenance, or use or entrustment to others of any auto owned or operated by or rented or loaned to any insured. The only exception is for parking an auto on the premises owned by the named insured, provided the auto is not owned by or rented or loaned to the insured. This allows coverage, for example, for a restaurant insured that has valet parking. If the valet staff is parking a customer's car and hits a pedestrian or some object, the CGL form will apply to that claim. Any damage to the car being driven by the valet staff may not be covered due to the care, custody or control exclusion.

The intent of this exclusion is to cover nonowned and hired auto liability coverage under the BAP by using either symbol 1, 8, or 9 as the exposure requires.