Personal Auto Policy – Part B

Personal Auto Policy – Part C

Personal Auto Policy – Part D

Definitions

A. Throughout this Policy, "you" and "your" refer to:

1. The named insured shown in the Declarations; and

2. The spouse if a resident of the same household.

If the spouse ceases to be a resident of the same household during the policy period or prior to the inception of this Policy, the spouse will be considered "you" and "your" under this Policy but only until the earlier of:

a. The end of 90 days following the spouse's change of residency; b. The effective date of another policy listing the spouse as a named insured; or c. The end of the policy period.

Analysis

This definition sets the parameters of "you" and "your" under the personal auto policy to the named insured, and spouse provided the spouse is a resident of the same household. It goes on to state that if the spouse ceases to be a resident of the same household, that the status of the spouse as an insured will cease at the earlier of 90 days from when the spouse changes residence, the spouse obtains another policy as a named insured, or the end of the policy period. Whether or not the couple divorces is immaterial; the issue is whether or not the spouse is a resident relative. In order for coverage to apply to any "family member", aside from being related to the insured by blood or marriage they must also be a resident relative. This applies to spouses as well. The policy treats the insured and spouse as equal under the policy as long as the spouse is a resident relative.

B. "We", "us" and "our" refer to the company providing this insurance. C. For purposes of this Policy, a private passenger type auto, pickup or van shall be deemed to be owned by a person if leased:

1. Under a written agreement to that person; and 2. For a continuous period of at least six months. Other words and phrases are defined. They are in quotation marks when used.

Analysis

This is standard policy language indicating how the insurance company is referred to throughout the policy.

This definition establishes that a leased vehicle is considered to be owned by the insured instead of the leasing company under the personal auto policy if it is under a written contract and leased for at least six consecutive months. The vehicle must be a private passenger auto, pickup or van. This definition helps to establish the difference between a leased vehicle and a short term rental vehicle, and which policy would provide coverage for the vehicle.

D. "Bodily injury" means bodily harm, sickness or disease, including death that results. E. "Business" includes trade, profession or occupation. F. "Family member" means a person related to you by blood, marriage or adoption who is a resident of your household. This includes a ward or foster child.

Analysis

While the term bodily injury seems straightforward, it is defined so that it is clear what exactly is meant. "Bodily injury" is defined as bodily harm, sickness or disease including death that results. What is not included is mental injury. For example, if an insured has an accident and a bystander is traumatized by witnessing the accident, the bystanders mental trauma is not considered an injury.

"Family member" is an important defined term, and is not as broad as many people suspect. It includes resident relatives, those related by blood or marriage, or foster children. It does not include significant others or partners, even though the insured may consider them family. The couple must also be legally married – "common law marriage" is no longer very common or even recognized by most states. The endorsement Additional Resident of Your Household PP 33 37 https://www.propertycasualty360.com/fcs/2022/08/25/additional-resident-of-your-household-pp-33-37-09-18/ has been developed to provide coverage for those nonfamily members that live in the household. The person must be listed in the schedule on the form, and the named insured is to notify the insurer within 30 days of the scheduled person's change in residency.

G. "Occupying" means:

1. In; 2. Upon; or 3. Getting in, on, out or off.

H. "Property damage" means physical injury to, destruction of or loss of use of tangible property.

I. "Trailer" means a vehicle designed to be pulled by a:

1. Private passenger auto; or 2. Pickup or van.

It also means a farm wagon or farm implement while towed by a vehicle listed in 1. or 2. above.

Analysis

Occupying is one of the more complicated definitions to understand, both in personal and commercial auto policies. The definition simply states that "occupying" means in, upon, or getting in, on, out, or off. But what exactly do all those terms entail? If someone takes groceries out of the vehicle is walking around to the other side, is that person in, upon, getting in, on, out or off? If someone is just leaning against a vehicle, is that person considered to be "occupying" the vehicle, is he upon it? In Darno v. Davidson, 34 N.E.3d 967  Darno's vehicle had stalled, he was pushing it out of the road with friends when another vehicle approached and Darno began running to get away from the other vehicle when he was struck by it. Darno filed a UM/UIM claim under the existing auto policy which denied it stating that Darno was not "occupying" the vehicle. The court decided that "occupying" was an ambiguous term, and found that Darno was entitled to UM/UIM benefits. In Lavoie v. Peninsula Ins. Cos, No. 2018-0711 (N.H. Nov. 8, 2019),  the insured was walking towards his vehicle to retrieve something and was struck by another vehicle. The insured filed a claim for injuries stating that he was "occupying" his vehicle because he was oriented toward the vehicle and his attention was also oriented towards the vehicle. The court determined the crossing the street to retrieve something for a customer was not "essential to the use of the vehicle" and that he was not "occupying the vehicle. In another case, D'Amour v. Amica Mut. Ins. Co, 891 A. 2d 534 (N.H. 2006) the insured was considered to be "getting out of" the vehicle when she had unloaded groceries from her car and was walking around it to the sidewalk when she slipped on the ice and fell suffering injuries.

The definitions of "property damage" and "trailer" are straightforward, Note that loss of use is considered "property damage", and that "trailer" includes farm wagons as well as other property that can be towed by an auto, pickup truck or van.

J. "Your covered auto" means:

1. Any vehicle shown in the Declarations; 2. A "newly acquired auto"; 3. Any "trailer" you own; or 4. Any auto or "trailer" you do not own while used as a temporary substitute for any other vehicle described in this definition which is out of normal use because of its:

a. Breakdown; b. Repair; c. Servicing; d. Loss; or e. Destruction.

This provision (J.4.) does not apply to Coverage For Damage To Your Auto.

K. "Newly acquired auto":

1. "Newly acquired auto" means any of the following types of vehicles you become the owner of during the policy period:

a. A private passenger auto; or b. A pickup or van, for which no other insurance policy provides coverage, that:

(1) Has a Gross Vehicle Weight Rating of 10,000 lbs. or less; and (2) Is not used for the delivery or transportation of goods and materials unless such use is:

(a) Incidental to your "business" of installing, maintaining or repairing furnishings or equipment; or (b) For farming or ranching.

2. Coverage for a "newly acquired auto" is provided as follows:

a. For any coverage provided in this Policy other than Coverage For Damage To Your Auto, a "newly acquired auto" will have the broadest coverage we now provide for any vehicle shown in the Declarations. However, for this coverage to apply, you must ask us to insure it within 14 days after you become the owner.

b. Collision Coverage for a "newly acquired auto" begins on the date you become the owner. However, for this coverage to apply, you must ask us to insure it within:

(1) 14 days after you become the owner, if the Declarations indicates that Collision Coverage applies to at least one auto. In this case, the "newly acquired auto" will have the broadest coverage we now provide for any auto shown in the Declarations.

(2) Four days after you become the owner, if the Declarations does not indicate that Collision Coverage applies to at least one auto. If you comply with the four-day requirement and a loss occurred before you asked us to insure the "newly acquired auto", a Collision deductible of $500 will apply.

c. Other Than Collision Coverage for a "newly acquired auto" begins on the date you become the owner. However, for this coverage to apply, you must ask us to insure it within:

(1) 14 days after you become the owner, if the Declarations indicates that Other Than Collision Coverage applies to at least one auto. In this case, the "newly acquired auto" will have the broadest coverage we now provide for any auto shown in the Declarations.

(2) Four days after you become the owner, if the Declarations does not indicate that Other Than Collision Coverage applies to at least one auto. If you comply with the four-day requirement and a loss occurred before you asked us to insure the "newly acquired auto", an Other Than Collision deductible of $500 will apply.

d. For all coverages addressed in Paragraphs K.2.a., b. and c., if you first ask us to insure the "newly acquired auto" after the applicable time period has elapsed, coverage will begin on the day you first ask us to insure the "newly acquired auto".

L. "Transportation network platform" means an online-enabled application or digital network used to connect passengers with drivers using vehicles for the purpose of providing prearranged transportation services for compensation.

Analysis

As with any insurance, it is important to understand exactly what property is being insured. The definition of "your covered auto" lists any vehicle shown in the declarations, a "newly acquired auto" which has its own definition, any "trailer" you own, and any auto or "trailer" not owned by the insured that is a temporary substitute for an owned auto that is out of normal use due to malfunction or breakdown.

The definition of temporary substitute does not apply to the physical damage coverages provided in the policy; that section has its own separate definition of "non-owned auto" that applies. Any vehicle the insured owns and wishes to provide coverage for must be listed on the declarations. Trailers, because they attach to the covered vehicle, are automatically provided coverage by the policy as long as they are owned by the insured. Non-owned trailers are handled differently.

Nonowned autos or "trailers" are included in the definition of "your covered auto" as long as they are being used as a temporary substitute for the covered vehicle while that vehicle is out of normal use due to breakdown, maintenance, repair, servicing, loss or destruction. So if the insured's vehicle malfunctions and is in the shop for repairs, the loaner or rental vehicle the insured is using while his vehicle is being repaired is considered "your covered auto" even though the insured has no insurable interest.

"Newly acquired auto" is a separate definition and describes vehicles the insured acquires during the policy period. These vehicles include private passenger autos, or pickups or vans with no other coverage that have a gross vehicle weight rating of 10,000 pounds or less and is not used for the delivery or transportation of goods and materials, unless that use is incidental the insured's "business" of installing, maintaining or repairing furnishings or equipment, or farming or ranching. Vehicles with a gross vehicle weight rating over 10,000 pounds are generally commercial vehicles and should be on a commercial policy. Transportation of goods is not allowed except for particular situation. An insured may have an upholstery shop and refinish furniture, and uses his van to transport furniture to his shop to do the refinishing. That is allowed. Likewise an insured may buy a van with which to transport his vegetables to the local farmers market; this is allowed.

Coverage for "newly acquired autos" applies separately depending on the coverage. For liability, medical payments, and uninsured motorists coverage, the broadest coverage on the policy applies to any "newly acquired auto" as long as the insured requests coverage within 14 days of acquisition. The language has been changed to make it clear that coverage is available for new vehicles only for 14 days from date of acquisition; if the insured does not request coverage before the 14 days expire, there will be no coverage.

The Collision and Other than Collision coverages are the same for "newly acquired autos" but are explained separately since it is possible for an insured to have just Collision,just Other than Collision, or both coverages on existing vehicles.

Coverage for both Collision and Other than Collision begins on the date the insured becomes the owner of the vehicle. However, the insured must ask the insurer for coverage for the vehicle within fourteen days of becoming the owner. If the policy has a vehicle with that coverage on it, then the broadest coverage will apply to the "newly acquired vehicle". For example, the insured purchases a new Tesla and already has a Toyota Camry with collision with a $500 deductible and other than collision with a $250 deductible. The insured also has a Ford Mustang with $1000/$5000. The Tesla would receive deductibles of $500/$250, since that is the broadest coverage currently on the policy. However, if there are no vehicles on the policy that have either collision or other than collision coverage, the insured has only four days to notify the insurer of the new vehicle. A deductible of $500 will then apply. If for some reason the insured fails to notify the insurer within the four or fourteen day time frame, then coverage will apply on the day the insured first asks the insurer for coverage. This section has been reworded for clarification.

A new definition, "Transportation network platform" has been added to the policy. A "transportation network platform" is an online-enabled application or digital network that is used to connect passengers with drivers using vehicles to provide prearranged rides for compensation. This is ride-sharing apps such as Uber, Lyft, Ubereats, Door Dash and others. It needs to be defined so that exclusions can be addressed later in the policy.