| Personal Auto Policy Endorsements | |||
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Endorsements - Part II Coverage for Damage to Your Auto PP 03 08 06 94 The limit of liability provision in part D of the PAP is replaced through the use of this endorsement. PP 03 08 limits liability for a loss to an auto scheduled on the endorsement to the lesser of the amount shown in the schedule of PP 03 08, the actual cash value (ACV) of the stolen or damaged property, or the amount necessary to repair or replace the property with other property of like kind and quality. This endorsement keeps the language about adjusting the actual cash value loss for depreciation and physical condition and about not paying for betterment that appears on the PAP. However, the language referring to "the amount shown in the schedule" allows the insurer to pay an amount for a loss to a covered auto that may be even less than actual cash value. The coverage is sometimes referred to as "stated amount"; the endorsement, however, makes it clear that this is not the case. Although the endorsement might be used for older vehicles in mint condition, it probably should not be used for antique or classic cars having considerable value. Single Liability Limits PP 03 09 01 05 This endorsement modifies paragraph A of the limit of liability provision in the PAP. The limit for liability coverage is scheduled through the use of PP 03 09 on an each accident basis. This scheduled limit is the maximum limit of liability for all damages resulting from any one auto accident, and is the most the insurer will pay regardless of the number of insureds, claims made, or vehicles involved in the auto accident. Excess Electronic Equipment Coverage PP 03 13 01 05 The 2005 PAP, under part D- Damage to Your Auto, provides $1,000 of coverage for electronic equipment that reproduces, receives or transmits audio, visual or data signals, and which is not installed in a location normally used by the auto manufacturer to install such equipment. (There is no limit for equipment, including aftermarket equipment, installed in the location used by the auto manufacturer.) Additional coverage beyond the $1,000 may be purchased by attaching this endorsement. Equipment could include CD players, navigational systems, telephones, or any other device used to transmit or receive audio, visual, or data signals. If an insured wishes to cover the tapes, records, disks or other media used with the equipment, this endorsement provides $200 worth of coverage. The insured may also use this endorsement to provide $200 worth of coverage for media used with the factory-installed equipment. A common misconception is that CDs, tapes, etc. are covered under the homeowners policy; if used with factory-installed or other permanently-installed equipment they are not covered. It is only when the tapes, CDs, etc., are used with equipment (such as a portable CD or DVD player) that is capable of being operated both by a vehicle's power source and another power source that a homeowners policy provides some coverage. Customizing Equipment Coverage PP 03 18 01 05 This endorsement deletes exclusion 10. of part D of the PAP. This exclusion precludes coverage for loss to custom furnishings or equipment in or upon any pickup or van. PP 03 18 offers coverage for direct and accidental loss to custom furnishings or equipment for vehicles that are scheduled on the endorsement, and this includes furnishings such as special carpeting, insulation, furniture or bars, height-extending roofs, and custom murals or decals. The endorsement does not mimic exclusion 10. by referring only to pickups and vans; any vehicle described in the schedule of PP 03 18 has coverage for customizing equipment. Pickups that have caps, covers, or bedliners need not have these scheduled on this endorsement, since these items are exempt from exclusion 10 for pickups. Limited Mexico Coverage PP 03 21 01 05 This endorsement gives the insured several warnings up front. First, auto accidents in Mexico are subject to the laws of Mexico, not the laws of the United States. Under Mexican law, auto accidents are considered a criminal offense as well as a civil matter. Second, the coverage provided by the endorsement does not meet Mexican auto insurance requirements. Third, the named insured is required to purchase liability insurance through a licensed Mexican insurance company for the provisions of PP 03 21 to apply. (Insurance is usually available at the U.S.-Mexican border.) Endorsement PP 03 21 offers liability, med pay, uninsured motorists, damage to your auto, and no-fault coverages (depending on which coverages the insured has under his or her PAP) for accidents and losses that occur in Mexico within 25 miles of the U.S. border. The coverages only apply while an insured is in Mexico on a trip of 10 days or less. The insurer promises to defend the insured under liability coverage only if the original suit for damages is brought in the United States, and if the suit does not involve a Mexican citizen or resident. Additionally, the insurer will not pay for auto repairs to the named insured's covered auto if the repairs are made in Mexico unless the covered auto cannot be driven in its damaged condition. The insurance provided by PP 03 21 is excess over any other collectible insurance. Joint Ownership Coverage PP 03 34 01 05 PP 03 34 is an endorsement meant to address the issue of coverage for individuals who are not married but who reside together and have joint ownership of a vehicle(s). The PAP states that "you" and "your" refer to the named insured and the spouse if a resident of the same household. PP 03 34 modifies this so that "you" and "your" refer to two or more individuals, "other than husband and wife", residing in the same household, or non-resident relatives who jointly own a private passenger auto, pickup, or van; the emphasis here is on the joint ownership of the covered auto, regardless of the relationship that exists between the joint owners. This endorsement adds a definition and an exclusion to the Personal Auto Policy. The added definition concerns "non-resident relatives"; this term means two or more persons related by blood, marriage, or adoption (including a ward or foster child) who reside in separate households. The exclusion is added to part A, the liability coverage of the PAP and states that liability coverage is not provided for the ownership, maintenance, or use of any vehicle, other than "your covered auto", by any non-resident relative or family member of a non-resident relative; this simply reinforces the fact that the insurer, based on both premium considerations and unforeseen risk exposures, does not want to insure any auto that is not included within the definition of "your covered auto". However, the 2005 endorsement allows the insured to "buy back" coverage for the excluded non-owned auto liability exposure. The PP 03 34 includes a schedule for the description of the jointly owned vehicle(s) and a schedule listing the coverages, limits of liability, and premiums applying to each described vehicle. Auto Loan/Lease Coverage PP 03 35 09 93 The Auto Loan/Lease Coverage endorsement, PP 03 35, is an endorsement meant to address a potential gap in coverage that many insureds might face. In fact, the endorsement is sometimes referred to as "gap coverage." PP 03 35 states that, in the event of a total loss, the insurer will pay any unpaid amount due on the lease for the covered auto less certain specified items. Another case where this endorsement would be used is if the amount due under the finance agreement is greater than the ACV of the auto at the time of loss, the insured has the obligation to pay that amount. PP 03 35 offers the insured coverage for such an amount, less, as in the lease situation above, the amount paid under part D of the PAP, any overdue loan payments, or costs for extended warranties. When a lease is involved, the list of specified items also includes any overdue lease payments at the time of loss, financial penalties imposed under the lease for excessive use or abnormal wear and tear, security deposits not refunded by a lessor, or life or health insurance purchased with the lease, and carry-over balances from previous leases. Endorsement PP 03 35 basically stands as a tool by which the insured can protect himself from a financial loss that he might not realize could face him in the event of the total loss of an auto that is leased or financed. The outstanding indebtedness of the insured is paid and the leasing or financing company is satisfied through the use of this particular endorsement. |
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Not only are policy forms, clauses, rules and court decisions constantly changing, but forms vary from company to company and state to state. This material is intended as a general guideline and might not apply to a specific situation. The authors, LunchTimeCE, Inc., CEfreedom, and LunchTimeCE and Sandi Kruise Training Inc, and any organization for whom this course is administered will have neither liability nor responsibility to any person or entity with respect to any loss or damage alleged to be caused directly or indirectly as a result of information contained in this course.
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