Covered Auto Descriptions

Introduction

The policy begins with an index of pages and an introduction explaining that certain terms are defined in the policy, and that terms not specifically defined should be taken at their conventional definition based on the context in which they are used. The word "provisions" is used to refer to all parts of the text of the policy, including agreements, conditions, exclusions, limits and all other terms. This is so that an insured knows that the policy should be viewed as a whole.

Common Glossary Parts II and III

COMMON GLOSSARY • PARTS II AND III Certain words and phrases used in this policy are defined for the purposes of this insurance contract. These are described in the following paragraphs:

Accident Accident includes continuous or repeated exposure to substantially the same general harmful conditions resulting in bodily injury or property damage.

Actual Cash Value Consideration may be given by us in our determination of actual cash value to: age; condition; cost to repair, replace, or restore the property, subject to deduction for depreciation; deterioration; economic value; market value; obsolescence; original cost; use; utility; or other circumstances that may reasonably affect value.

Auto Auto means:

1. Any land motor vehicle or trailer (including semitrailers) designed for travel on public roads.
2. Any other land vehicle that is subject to a compulsory or financial responsibility law or other motor vehicle insurance law in the state where it is licensed or principally garaged. Auto does not include mobile equipment.

Bodily Injury Bodily injury means bodily harm, sickness, or disease sustained by any person including death at any time resulting from such.

Diminution in Value Diminution in value means the actual or perceived reduction in market or resale value that results from a loss.

Employee Employee means a person employed by you and includes a leased worker. Employee does not include a temporary worker or independent contractor.

Family Member Family member means any person related to you by adoption, blood, or marriage who is a resident of your household. This includes a ward or foster child.

Fungi Fungi means any type or form of fungus, mold, mildew spores, algae, smut, protists, rusts or rot and decay organisms, and any similar or related organisms and any mycotoxin, substance, compounds, chemicals, mist or vapor produced by any fungi in any form, or any by products or waste produced by fungi, but does not include any fungi intended to be edible.

Insured Insured means any person or organization listed as such in the applicable Who Is An Insured provision.

ANALYSIS

While the Glossary is presented last in the policy form, since the terms are used throughout the policy, we will discuss that section first. Many of the definitions are similar to those found in ISO forms, although there are variations and there are some terms defined here that ISO does not define. In these forms defined terms are shown in italics, and not within quotation marks (").

The definition of Accident is straightforward and standard. Accident itself isn't defined, but the term includes continuous or repeated exposure to substantially the same general harmful conditions that result in bodily injury or property damage. It can be one exposure, such as an auto accident that occurs at a given point in time, or exposure to a harmful element that an individual is exposed to on more than one occasion that results in injury or property damage of some sort.

The determination of actual cash value includes consideration of an item's age, condition, and cost to repair, replace or restore to pre-loss condition. The determination is also subject to deductions for depreciation, deterioration, economic or market value, obsolescence, original cost, use, utility, or other factors that affect the overall value of the item. Basically, the condition of any damaged property will affect the value of said property, and whether the property is repairable or will be considered a total loss, and whether the insured or claimant will be paid for the loss of the item.

Land motor vehicles or trailers, including semi-trailers, that are designed for travel on public roads are included in the definition of auto. Also included is any other land vehicle that is subject to compulsory or financial responsibility law or other motor vehicle insurance law in the state where the vehicle is licensed or principally garaged. A business may have operations in multiple states; that will affect how coverage is applied, and if a land vehicle of some sort is required to have insurance in the state where that vehicle is garaged, that vehicle is considered an auto barring any exclusions or other definitions that would put that vehicle into a different category. Mobile equipment such as bulldozers, vehicles on crawler treads, forklifts and farm machinery are not considered to be autos.

Bodily injury uses a standard definition of bodily harm, sickness, or disease sustained by a person including death that results from such harm, sickness or disease. What the definition does not mention is any mental illness or distress either on its own or related to bodily harm, sickness or disease.

The decrease in value of property, whether actual or perceived, is diminution of value. The decrease is in either the market value or resale value of an item that results from a loss.

Employees are those individuals employed by the insured and leased workers are included in the definition of employee. Not included in the definition are temporary workers or independent contractors, as the nature of their employment is different than others hired for various tasks.

Any person related to the insured by adoption, blood, or marriage who resides in the household is considered a family member. Wards and foster children are also considered to be family members as they are under the care of an insured and in the household on an ongoing basis.

Fungi are defined as any type or form of fungus, mold, mildew, spores, algae, smut, protists, rusts or rot and decay organisms. This includes similar or related organisms and any mycotoxin, substance, compounds, chemicals, mist or vapor produced by any fungi in any form, or any by-products or waste produced by fungi. Not included is edible fungi. Mushrooms grown for consumption would not fall under this definition of fungi. The intent is to define fungi that are harmful and need to be restricted or excluded from coverage.

The definition of insured is straightforward; anyone listed as such under the Who Is An Insured provision in the policy is included in the definition of insured. The Who Is An Insured section is extensive, and lists you using a covered auto, and anyone else using a covered auto with the insured's permission other than certain specified individuals as shown in the liability section of the policy. We will discuss this in the Main Liability Coverages.

Leased Worker

Leased worker means a person who is leased to you by a labor leasing firm under an agreement between you and such firm to perform duties related to the conduct of your business / operations. Leased worker does not include a temporary worker.

Loss

Loss means fortuitous direct physical damage or destruction including the taking of property by theft.

Mobile Equipment

Mobile equipment means any of the following land vehicles (including any equipment or machinery permanently attached to, or forming an integral part of, the vehicle):

1. Vehicles used solely at premises owned or rented by you.
2. Vehicles designed for primary use off public roads such as bulldozers, farm machinery, forklifts, and similar commercial types.
3. Vehicles used primarily to provide mobility to the following:

1. Concrete mixers (other than mix-in-transit type).* 2. Diggers, drills, loaders, power cranes, or shovels.* 3. Road construction and resurfacing equipment, such as graders, rollers, or scrapers.*

D. Vehicles that are not self-propelled used primarily to provide mobility to:

1. Air compressors, generators, or pumps; building cleaning, geophysical exploration, lighting, spraying, welding, or well servicing equipment.*
2. Cherry pickers and similar devices used to lower / raise workers.*

E. Vehicles that travel on crawler treads. F. Vehicles not otherwise used as described in the preceding Paragraphs A through E that are maintained by you primarily for uses other than the transportation of cargo or persons.

However, self-propelled vehicles designed as described in the following Paragraphs 1, 2 and 3 or equipped with any of the following permanently attached devices are not mobile equipment but are considered autos for the purposes of this Insurance:

1. Designed primarily for road maintenance (other than road construction or resurfacing), snow removal, or street cleaning. 2. Equipped with air compressors, generators, or pumps; building cleaning, geophysical exploration, lighting, spraying, welding, or well servicing equipment. 3. Equipped with cherry pickers and similar devices mounted on automobile or truck chassis and used to raise / lower workers.

However, mobile equipment does not include any land vehicle that is subject to a compulsory or financial responsibility law or other motor vehicle insurance law in the state where it is licensed or principally garaged. Land vehicles subject to a compulsory or financial responsibility law or other motor vehicle insurance law are considered autos. * However, only if permanently attached to, or forming an integral part of, the vehicle.

Occupying

Occupying means getting in, getting off, getting out of, in, on, or upon.

Pollutants

Pollutants are any gaseous, liquid, solid, or thermal contaminant or irritant, including acids, alkalis, chemicals, fumes, smoke, soot, vapors, and waste (including materials to be reclaimed, reconditioned, or recycled).

Private Passenger Type

If you are an individual, private passenger type also includes any covered auto owned by you that is a pickup or van type truck not used for business purposes, other than farming or ranching.

Property Damage

Property damage means the following:

1. Direct physical injury to tangible property, including loss of use of such property (the loss of use is deemed to occur at the time of such direct physical injury).
2. Loss of use of tangible property that is not physically injured: all such loss of use is deemed to occur at the time of the accident causing the loss.

Rot and Decay Organisms

Rot and decay organisms means any living organism that causes decomposition of physical property.

Temporary Worker

Temporary worker means a person who is furnished to you as a substitute for a permanent employee on leave or to meet seasonal or other short-term workload conditions. Temporary worker does not include a leased worker.

Trailer

Trailer includes semitrailer.

We / Us / Our

We, us, and our refer to the Insurance Company named in this policy.

You / Your/ Yourself

You, your and yourself refer to the named insureds who are the insured named in the Declarations. First named insured is the insured named first in the Declarations. You also includes the insured's spouse if a resident of the same household.

Your Work

Your work means the following:

1. Operations or work performed by you or on your behalf.
2. Equipment, materials, or parts furnished in connection with such work or operations.

Your work also includes the following: warranties or representations made at any time with respect to the durability, fitness, performance, quality, or use of any of your work; providing or failing to provide instructions or warnings.

ANALYSIS

A leased worker is someone leased to the insured by a labor leasing firm under an agreement to perform duties related to the conduct of the insured's business or operations. A leased worker is not the same as a temporary worker, which is someone provided for a short period of time to substitute for an absent employee or to fill in during peak productivity seasons. A temporary employee may fill in while someone is on maternity leave, or only work through the holiday season as that is the company's busiest time.

Loss is defined as direct physical damage or destruction, including the taking of property by theft. A loss is often the result of an accident. While stolen property may be returned, it is still lost to the owner; the owner no longer has access to it while it is in the custody of the thief.

The definition of mobile equipment is extensive. It is any of the listed land vehicles, including equipment or machinery permanently attached to, or forming an integral part of the vehicle.

Vehicles used solely at the premises owned or rented by you. Vehicles designed for primary use off public roads – bulldozers, farm machinery, or other commercial types of vehicles. Vehicles used to provide mobility to the following as long as the equipment is permanently attached to or forms an integral part of the vehicle: Concrete mixers (other than mix-in-transit types) Diggers, drills, loaders, power cranes or shovels Road construction and resurfacing equipment, such as graders, rollers or scrapers Vehicles that aren't self-propelled used primarily to provide mobility to the following equipment, again only if the equipment is permanently attached or is an integral part of the vehicle: Air compressors, generators, pumps, building cleaning, geophysical exploration, lighting, spraying, welding or well servicing equipment, Cherry pickers and similar devices used to lower/raise workers Vehicles on crawler treads Vehicles not otherwise described that are maintained by you for uses other than transportation of cargo or persons. The following vehicles or vehicles equipped with any of the following equipment permanently attached are an exception and are considered autos for coverage purposes: Designed for road maintenance (other than construction or resurfacing), snow removal or street cleaning Equipped with air compressors, generators, pumps; building cleaning, geophysical exploration, lighting, spraying, welding or well servicing Equipped with cherry pickers and similar devices mounted on auto or truck chassis and used to raise/lower workers.

However, land vehicles that are subject to compulsory or financial responsibility law or other insurance law in the state where the vehicle is licensed or principally garaged are not considered mobile equipment.

Occupying is defined as getting in, getting off, getting out, of, in, on, or upon a vehicle. While this seems straightforward, what is considered being on a vehicle is often a point of discussion. Is leaning against a vehicle being on the vehicle, or does someone have to be sitting on the hood or trunk of the vehicle to be considered to be on the vehicle? What if someone is putting bags in the trunk; is that occupying the vehicle? It's a complicated issue to be sure.

Pollutants are defined as any gaseous, liquid, solid, or thermal contaminant or irritant, including acids, alkalis, chemicals, fumes, smoke, soot, vapors, and waste (including materials to be reclaimed, reconditioned, or recycled). This is the standard definition of pollutants used in most property policies. Carriers all want to exclude the same substances, and the standard language works for most carriers.

The definition of private passenger type is geared towards individual insureds. The definition states that private passenger type, if you are an individual, is a covered auto owned by you that is a pickup or van type truck not used for business purposes, other than farming or ranching. Therefore, if an insured has a pickup truck listed on the policy and that truck is not used in the business, then that truck is considered to be a private passenger auto. There is no specified limit as to the size of the pickup truck or van.

The definition of property damage contains two components; the first is direct physical damage to tangible property, including loss of use of that property, and the second is loss of use of property that itself wasn't physically damaged. Loss of use in both instances is deemed to occur at the time of either direct physical damage to the property at the time of the accident, or the loss of use of the property at the time of the accident.

Rot and decay is straightforward; it is any living organism that causes decomposition of physical property. Since fungi is separately defined, this would consist of organisms other than fungi, such as bacteria. Bacteria are single celled, while fungi are larger and include molds and mushrooms.

A temporary worker is different than a leased worker. Temporary workers are on a short term basis, and in general are substituting for an employee on leave, for example maternity leave, or to meet seasonal demands or other short-term needs for extra help.

A trailer is defined to include a semi-trailer; there is no other description of types of trailers in this definition. The intent is to acknowledge that semi-trailers are considered trailers for the purpose of this policy form.

We/Us/Our uses the standard definition that when referenced in the policy form we/us/our refers to the insurance company named in the policy.

Likewise, you/your/yourself is used to refer to the named insureds who are listed as insureds in the declarations page. First named insured is the insured named first in the declarations page. If a spouse is a resident of the same household, then you includes that resident spouse as well.

Your work is the operations or work performed by the insured or on the insured's behalf, and includes equipment, materials, or parts furnished in connection with such work or operations. Also included as your work is warranties or representations made at any time regarding the durability, fitness, performance, quality or use of any of the insured's work, or providing or failing to provide instructions or warnings. If the insured makes statements about his work that are not accurate, or provides faulty instruction, customers could be injured as a result.

Covered Auto Descriptions

1. COVERED AUTO SYMBOLS The following numerical symbols describe the types of autos that are covered autos for those coverages provided in this policy for which that symbol is shown in the Declarations.

SYMBOL DESCRIPTION

1. Any Auto.
2. Owned Autos Only. Only those autos you own. This also includes autos that you newly acquire ownership of during the current policy term. For Liability Coverage, Symbol 2 also includes trailers not owned by you while attached to an auto you own.
3. Owned Private Passenger Autos Only. Only those private passenger autos you own. This also includes private passenger autos that you newly acquire ownership of during the current policy term.
4. Owned Autos Other than Private Passenger Autos Only. Only those autos you own that are not of the private passenger type. This also includes such autos that you newly acquire ownership of during the current policy term. For Liability Coverage, Symbol 4 also includes trailers not owned by you while attached to an auto you own.
5. Owned Autos Subject to No-Fault. Only those autos you own that are required to have "no-fault" benefits in the state where such autos are licensed or principally garaged. This also includes such autos that you newly acquire ownership of during the current policy term.
6. Owned Autos Subject to a Compulsory Uninsured Motorists Law. Only those autos you own that are required to have, and cannot reject, Uninsured Motorists Coverage in the state where such autos are licensed or principally garaged. This also includes such autos that you newly acquire ownership of during the current policy term.
7. Specifically Described Autos. Only those autos described in the "Schedule of Covered Autos You Own" in the Declarations for which a related premium charge is shown. For Liability Coverage, Symbol 7 also includes trailers not owned by you while attached to an auto described in such Schedule.
8. Hired Autos Only. Only those autos you borrow, hire, lease, or rent. This does not include any auto you borrow, hire, lease, or rent from: any of your employees, executive officers, partners; (if you are a partnership), or members (if you are a limited liability company) or members of their households.
9. Nonowned Autos Only. Only those autos you do not borrow, hire, lease, own, or rent that are used in connection with your business / operations. Symbol 9 includes autos owned by your employees, executive officers, partners, (if you are a partnership), or members (if you are a limited liability company) or members of their households but only while used in connection with your business /operations or personal affairs.

ANALYSIS

As in the ISO policy, the MSO policy identifies the different types of vehicles by the use of symbols. These are similar to the ISO symbols.

Symbol 1 is any auto, and is useful when an insured has multiple types of vehicles, or routinely obtains new vehicles throughout the year and gets rid of others. It provides the broadest coverage and as a result is the most expensive symbol.

Symbol 2 is for owned autos only. These are vehicles the insured owns; not leases, not rents, but owns outright. This also includes vehicles the insured newly acquires during the policy term, and for liability coverage for trailers that are not owned by the insured but are attached to an auto the insured owns. Those trailers are covered as well.

Symbol 3 refines the definition even further and covers owned private passenger autos only. If a vehicle is not a private passenger auto, even though it is owned by the insured, symbol 3 will not provide coverage. Newly acquired owned private passenger autos acquired during the policy period are covered as well.

Symbol 4 is for owned vehicles other than private passenger autos; this covers what symbol 3 doesn't. Like symbol 2, it also includes liability coverage for trailers the insured does not own but that are attached to a vehicle the insured owns.

Symbol 5 specifically provides coverage for owned vehicles required to have no-fault coverage by the state in which the vehicle is licensed or principally garaged. Again, it includes vehicles the insured newly acquires during the policy period.

Symbol 6 is similar, and provides coverage for owned vehicles subject to compulsory uninsured motorists laws that are required in states where the vehicles are licensed or principally garaged. The insured must be required to have, and must be unable to reject, uninsured motorist coverage. Vehicles the insured acquires during the policy period are covered as well.

Specifically described autos are covered under symbol 7; this is for vehicles specifically listed on a schedule of covered autos. The autos must be listed in the declarations with a related premium charge listed as well. As with certain other symbols, symbol 7 includes liability coverage for trailers not owned by the insured but attached to vehicles described in the schedule.

Symbol 8 is for hired autos only. A hired auto is one the insured borrows, hires, leases, or rents, unless the vehicle belongs to any of the insured's employees, executives, officers, partners (if a partnership), or members (if the insured is a LLC), or members of their households.

Symbol 9 is for those autos the insured does not own, hire, lease, borrow, or rent that are used in the insured's business or operations. This includes autos owned by the insured's employees, executive officers, partners (if a partnership), or members (if a LLC) or members of their households, but only while used in conjunction with the insured's business/operations or personal affairs. The addition of personal affairs allows an insured to send an employee to pick up the insured's dry cleaning, and if that employee injures another party in an accident, that party will be covered by this policy.

2. OWNED AUTOS ACQUIRED DURING THE POLICY TERM

1. If Symbols 1, 2, 3, 4, 5, or 6 are entered for a coverage in the Declarations, then you have that coverage for the remainder of the policy term for any autos of the type described by such symbol that you newly acquire.
2. If Symbol 7 is entered for a coverage in the Declarations, then an auto you newly acquire will be a covered auto for that coverage only if:

1. We already insure all autos that you own for that coverage, or the newly acquired auto replaces an auto you previously owned which was insured for that coverage; and 2. You let us know within 30 days after acquiring the auto that you want us to insure it for that coverage.

ANALYSIS

This section simply clarifies under which symbols coverage is provided when vehicles are newly acquired during the policy period. For symbols 1-6, newly acquired vehicles are covered for whatever coverage is listed for the listed symbol. For example, an insured has symbols 2 and 6 on the policy, with collision and other than collision coverages on vehicles with those symbols. Therefore, any newly acquired vehicles will have those coverages automatically applied to them.

When the insured has symbol 7 on the policy, with a specific schedule of vehicles, then coverage for newly acquired vehicles is very specific. Coverage for newly acquired autos applies only if two conditions are met; the first is all autos the insured owns are on the policy for that coverage, or the newly acquired auto replaces an auto the insured previously owned that was insured for that coverage. Also, the insured is required to notify the carrier within 30 days of acquiring the auto that the insured wants to insure for that particular coverage.

For example, an insured has a specifically insured 2010 Jaguar with liability, collision and other than collision. The insured sells the Jaguar and buys a 2021 Mercedes to replace the Jaguar on December 1, 2020. The insured notifies the carrier immediately of the change in cars. Therefore, the Mercedes will be covered under Symbol 7. However, if the insured gets busy and forgets to notify the carrier of the new vehicle until January 15, then the insured will have a lapse in coverage for that vehicle from December 31 through January 15.

3. CERTAIN MOBILE EQUIPMENT, TEMPORARY SUBSTITUTE AUTOS, AND TRAILERS

If Liability Coverage is provided by this policy, then the following vehicles are also covered autos for Liability Coverage:

1. Any auto that you do not own while it is used with the permission of its owner as a temporary substitute for a covered auto that is out of use because of loss to it or its breakdown, repair, servicing, or destruction.
2. Mobile equipment while being carried or towed by a covered auto.
3. Trailers with a load capacity of 2,000 pounds or less that are designed primarily for travel on public roads.

ANALYSIS

This section deals with liability coverage for certain types of autos when liability coverage is provided by the policy. Autos that the insured does not own, and that are being used with permission of the owner as a temporary substitute for a covered auto that is out of use because of loss, breakdown, repair, servicing, or destruction are covered. If an insured's auto has been in an accident, and the business owner next to the insured's business loans the insured the use of one of his vehicles while the one vehicle is being repaired, that borrowed vehicle is covered under the insured's policy for liability coverage.

Mobile equipment is covered for liability coverage while that equipment is being carried or towed by a covered auto. Lastly, trailers with a load capacity of 2,000 pounds or less that are designed primarily for travel on public roads are also covered for liability coverage.