Auto Dealers... for chain of custody... if someone orders a vehicle and it's damaged while a dealership is waiting for the customer to accept delivery... maybe the dealer is installing equipment on it before the customer picks it up... is the damage still on the dealer physical inventory blanket or the Garagekeepers. I believe it would be the blanket until they accept delivery?
What if there is a contract between the manufacturer and the customer and the dealer is just acting as a sales rep for the manufacturer? (We have this specific situation and I'm trying to figure out where to put the vehicles... fire trucks in this case).
Wisconsin Subscriber
Using the standard ISO forms CA 00 25 Auto Dealers Coverage Form and CA 00 05 Garage Coverage Form, to answer the first part of your question, the auto dealers coverage form covers vehicles in possession of the dealer until title has passed. So if the title has passed then the vehicle will not be part of the dealer's inventory. If however the title is still in the name of the dealer, then since the vehicle(s) is still in the possession of the dealer and customer has not yet accepted delivery, then the auto dealers coverage form will apply. Since the dealer is installing work on the vehicle when it is damaged, if the title has not yet been transferred to the purchaser, then the property damage is actually occurring to the dealer's inventory vehicle. There are two exclusions of note for such vehicles - the care, custody or control exclusion, and the exclusion for work you performed. The care, custody or control exclusion excludes property damage to property owned by the insured, property loaned to the insured, property held for sale, or any property in the insured's care, custody or control. The work you performed exclusion excludes property damage to work the insured performed if such property damage results from the insured's work itself or from the parts, materials or equipment used in connection with the work.
As for the second part of your question, this would depend upon the exact terms of the contract. The contract should state who is responsible for the vehicle(s) at which point in time the damage occurred. If the dealer is acting as a sales representative only, then the dealer would not be performing any work on the vehicle. If the dealer performs any work on the vehicle then they are no longer only acting as a sales representative.
If the dealer never takes title/interest and is just storing the vehicle for the manufacturer and upfitting it before customer acceptance, then the vehicle would fit symbol 29 on the garage coverage form, which covers any auto used in connection with the insured's garage business, as long as such auto is not owned, leased, hired, rented or borrowed by the insured, or symbol 31 which covers physical damage for any autos that are described in Item Seven of the declarations. Note that this will be determined by the actual coverage form, because the ISO garage form is not designed for use in covering fire trucks.
Under the garage coverage form, "garage operations" is a defined term, which will pay sums for damages for which the insured is legally liable, for property damage caused by an "accident" and resulting from "garage operations" involving the ownership, maintenance, or use of covered autos. This form however, contains the same exclusions of care, custody or control or work you performed that is in the auto dealers coverage form.
The Garagekeepers coverage in the Garage coverage form provides (if purchased) comprehensive coverage from any cause for damages the insured is legally liable for "loss" to a "customer's auto" while such is in the insured's care while attending, servicing, repairing, parking or storing it in the insured's garage operations. The exclusions that could pertain to the loss are for defective parts, faulty "work you performed", or contractual liability.
If you would like us to review the specific details of the loss, and the actual forms that pertain to the loss, we will be happy to further review.