The coverage form begins with a statement indicating that the policy includes the declarations, which must be attached to this form along with any other applicable endorsements. It then provides a table of contents to help locate the coverage provided.

The final section of the introduction explains the definitions of words. If a word is italicized, its definition can be found in one of the sections:

Common Glossary – Parts II and III at the end of the coverage form.
Part III B – Supplemental Coverages – 3.B. Glossary
Common Exclusion—Parts II and III – 2.C. Glossary

It also explains that the word “provisions” is a comprehensive term referring to the entire text of the insurance contract. It includes agreements, conditions, exclusions, limits, limitations, and all other terms within the contract.

When a word or phrase is not specifically defined, it is to be defined by conventional methods while holding the word in context.

PART I–COVERED AUTO SYMBOLS

Numerical symbols are used to describe which autos are covered and what coverages apply. These symbols are defined in the Symbol Description.

The Business Auto Declarations should include symbol(s) next to each covered business auto. A symbol displayed indicates that coverage applies. The symbol clarifies which types of vehicles are covered.

1. Description of Covered Auto Designation Symbols

1–Any Auto

This symbol provides the broadest coverage, with no limitations or restrictions. If a vehicle qualifies as an auto under this coverage form, it is covered, although certain exclusions and conditions apply. Due to its broad scope of coverage, many insurers use it cautiously. For example, a company might permit its use for liability but not for physical damage. When Symbol 1 is used, no other symbols should be included in the same box.

NOTE: See Common Glossary Parts II and III for the definition of auto.

Example: Mary was unsure which symbol to enter on the application. To be safe, she entered 1, 2, 3, 4, 5, 6, 7, 8, and 9, thinking any auto would then be covered. Instead of helping, it caused confusion. If she had entered only the symbol 1, she could have achieved the goal without any confusion.

2–Owned Autos Only

This symbol means any auto owned by the named insured is covered, including those acquired after the policy inception date. Additionally, when this symbol is used with liability coverage, any owned or non-owned trailer being pulled by an owned vehicle is also covered.

NOTE: See Common Glossary Parts II and III for the definition of trailer.

3–Owned Private Passenger Autos Only

This symbol means all private passenger cars owned by the named insured are covered. This includes any private passenger vehicle acquired after the policy inception date.

NOTE: The term 'private passenger type' is not defined. Pickup trucks and vans that might be considered private passenger on a personal lines policy are treated as commercial autos on this policy. Additionally, there is no coverage for nonowned trailers attached to the private passenger auto.

4–Owned Autos Other Than Private Passenger Autos Only

This symbol means all autos not classified as private passenger types are covered if owned by the named insured. Vehicles acquired after the policy inception date are also covered. Similar to Symbol 2 above, the liability coverage extends to nonowned trailers pulled by this type of owned vehicle.

5–Owned Autos Subject to No-Fault

This symbol means any auto owned, licensed, or garaged in a state where no-fault coverage is mandatory is covered for no-fault coverage, but only if that specific auto is required to have such coverage. Coverage also includes autos acquired after the policy inception date.

6–Owned Autos Subject to A Compulsory Uninsured Motorists Law

This symbol means any auto owned and garaged or licensed in a state requiring uninsured motorists coverage is covered. It also includes autos acquired after the policy inception date.

NOTE: This symbol does not apply to vehicles licensed or operated in states where the named insured can formally decline Uninsured Motorists coverage.

7–Specifically Described Autos

Only autos specifically scheduled and for which a premium charge is made are covered. Similar to Symbol 2 above, the liability coverage provided is extended to any non-owned trailer pulled by this type of owned vehicle.

NOTE: Please refer to 2.B.–Owned Autos Acquired During the Policy Term below for autos acquired during the policy period.

8–Hired Autos Only

This symbol means any autos the named insured leases, hires, rents, or borrows are covered.

However, this symbol has a significant limitation. It does not include leased, hired, rented, or borrowed vehicles owned by an employee, partner, LLC member, or members of any of the preceding groups’ households.

Example: Judy, an employee at When You Call, needed to respond to a call but her company car was in the garage for repairs. She chose to use her son’s car since it was a short trip. Unfortunately, Judy ran a stop sign and collided with another vehicle. The When You Call policy does not cover this incident due to the family limitation under symbol 8.

9–Non-Owned Autos Only

This symbol means autos the named insured uses in its business but does not own, lease, hire, rent, or borrow are covered. These vehicles may be owned by an employee, partner, LLC member, or members of any of the preceding groups’ households. However, coverage applies only when they are used for the named insured’s business operations or personal activities.

Example: In the example above, When You Call’s insurance company will respond if Symbol 9 is indicated on the policy because Judy was using her son’s auto for a business call.

2. Owned Autos Acquired During the Policy Term

A. If the following symbols are indicated on the Declarations:

· 1–Any Auto

· 2–Owned Autos Only

· 3–Owned Private Passenger Autos Only

· 4–Owned Autos Other Than Private Passenger Autos Only

· 5–Owned Autos Subject to No-Fault

· 6–Owned Autos Subject to a Compulsory Uninsured Motorists Law

Then, newly acquired autos of the symbol type indicated are also covered during the policy period. No notification requirements apply.

B. When symbol 7–Specifically Described Autos is indicated on the Declarations, any new autos acquired during the policy period are covered if one of the following conditions is met:

· All autos owned by the named insured are already covered.

· The newly purchased vehicle is a replacement for an auto currently scheduled.

· The insured must notify the insurance company within 30 days of purchasing a new vehicle for coverage to apply.

Example: Green’s commercial auto policy has a symbol 1 for liability coverage and a symbol 7 for physical damage coverage. Seven vehicles are scheduled for physical damage. When Green buys a new auto and an accident happens, he reports it to the insurance company for coverage.

Scenario 1: The new auto replaced one of the seven scheduled vehicles. The accident occurred the day after the purchase. Coverage applies for liability and physical damage.

Scenario 2: The new auto did not replace a scheduled auto. However, all autos owned by Green are scheduled. The accident occurred 35 days after the acquisition. Coverage applies for liability and would have covered physical damage if he had reported the new purchase. However, since he did not report the acquisition, physical damage coverage does not apply.

3. Certain Mobile Equipment, Temporary Substitute Autos, And Trailers

When liability coverage for covered autos is chosen, several additional vehicle categories are included as covered vehicles, but only for liability.

A. If the named insured's covered, owned auto is temporarily out of service for repair, service, breakdown, loss, or destruction, a nonowned, temporary substitute auto is covered, provided the insured uses it with the owner's permission.

Example: Jason, a piano tuner, uses his van to visit clients. When his van is at the dealership for service, a client contacts him with an emergency tuning request at the opera house.

Scenario 1: Jason notices his friend’s truck is available, so he gets in and drives off. When Jason has an accident, there's no coverage because he didn't get permission to take the vehicle.

Scenario 2: Jason asks Louie to take him to the job, but Louie simply hands him his keys. When Jason has an accident, liability coverage applies because Jason’s auto was in for maintenance, and Louie gave him permission to use it.

B. Mobile Equipment is covered while being carried or pulled by a covered auto.

Example: Herman is driving a covered tractor-trailer carrying an asphalt plant. The asphalt plant was not secured properly and began to sway, eventually toppling over. The liability-related damage caused by that asphalt plant is covered.

C. Trailers with a load capacity of 2,000 pounds or less, designed for travel on public roads, are covered, but only when being pulled by a covered vehicle auto.

NOTE: A semi-trailer is not covered.

Example: Precious is headed to a convention for Bears, Inc., pulling a small trailer that holds the company’s booth and stuffed bears. Liability symbols are 3, 8, and 9. During a lane change, Precious switches lanes too abruptly, causing the trailer to collide with the front of a car.

Scenario 1: Precious is using her personal pickup truck to tow the trailer because her company vehicle is too small. The loss is covered by Bears, Inc.’s commercial auto policy because the towing vehicle is a nonowned vehicle (9), which qualifies as a covered auto.

Scenario 2: Precious is using her personal pickup truck to tow the trailer because she needs the company’s convention booth to help her son with his science fair project. The loss isn't covered by Bears, Inc.’s commercial auto policy because the towing vehicle wasn't being used for company business at the time, so it doesn't qualify under symbol 9.

PART II A – MAIN LIABILITY COVERAGES

1. Application of this Insurance (Part II)

This section of the policy covers liability only for the autos listed in the Declarations and for the auto symbol shown. It does not require providing any insurance or services or paying any expenses beyond what is explicitly covered and insured in the policy.

2. Coverage A – Liability to Others

A. The coverage is only for the benefit of insureds. Payment will be made only up to the limit of liability listed on the Declarations and explained in Part II D – Special Liability Conditions. The insured must be found legally responsible for damages caused by an accident resulting in bodily injury or property damage. The bodily injury or property damage must also be covered by the policy.

The accident must result from a covered auto that is maintained, owned, or used by the insured. Only accidents that occur during the policy period and within the coverage territory as defined in the Common Conditions are covered.

Related Court Cases:

Road Rage Triggers Coverage Dispute

What Is A Permissive Use Of A Commercial Vehicle?

B. When damages are not covered by the policy, the insurance company has no obligation to pay. Additionally, if damages exceed the limits of liability specified in Part II D – Special Liability Condition, the insurance company is not required to pay the excess, even if those damages are covered.

C. Who Is an Insured – Coverage A

For coverage A, the term 'insured' means the following:

1. The named insured is an insured for any covered auto.

2. Anyone authorized to use a covered auto owned, hired, or borrowed by the named insured is considered an insured, except for the following exceptions:

Related Court Case: What Is A Permissive Use Of A Commercial Vehicle?

a. An owner, or anyone from whom the named insured borrows or hires a covered auto, as well as their agents or employees, is not an insured.

Trailers are not subject to this exception if both of the following apply:

· Trailer is attached to a covered auto

· Covered auto is owned by the named insured

b. An employee of the named insured is not considered an insured for a covered auto owned by that employee or a household member.

c. If the named insured is a partnership, then a partner of that partnership or a household member is not regarded as an insured for a covered auto owned by that partner or household member.

d. If the named insured is a limited liability company, then a member of that LLC or someone in their household is not regarded as an insured for a covered auto owned by that person or a household member.

e. Anyone moving property to or from a covered auto is not considered an insured during the move. However, this exception does not apply to the following individuals or situations, which remain insured:

· The named insured’s partners

· The named insured’s employees

· Anyone from whom the covered auto is being leased or borrowed

· Employees of anyone from whom the covered auto is being leased or borrowed

Example: Patricia is a carpenter who owns a business-use pickup truck. She allows her parents to use it for moving household items to their new home. During the unloading of a chest of drawers, the furniture starts to tilt and falls, causing serious injuries to their new neighbors’ dog, which was watching. This accident is not covered by Patricia’s commercial auto insurance because her parents are not insureds.

NOTE: If Patricia’s parents were her partners, they would have remained insureds.

f. Anyone using a covered auto for business activities such as parking, repairing, selling, servicing, or storing vehicles is not considered an insured. However, this exception does not apply if the business is the named insured’s.

3. Anyone held liable for an insured's conduct as described in items 1. and 2. above is also regarded as an insured, but only to the extent that they are legally responsible for that insured’s actions.

3. Coverage B- Medical Payments

This coverage applies only when a limit of liability for Medical Payments is listed on the Declarations.

A. This coverage pays for reasonable and necessary medical expenses an insured incurs due to an accident. Payments are limited to the amount specified in the Declarations and detailed in Part II D – Special Liability Conditions.

· The accident must occur during the policy period and within the coverage territory as defined in the Common Conditions.

· Payments are issued only if expenses are incurred and reported to the insurance company within three years of the accident. Reporting can be done by either the injured party or the named insured.

· Medical payments are not based on liability or fault, and the insurance company does not admit guilt when making these payments. However, any medical payment must be for bodily injury that is not excluded or deemed uninsured under this policy.

Example: Bob Jones sustains injuries after being hit by a vehicle. He is the named insured on his commercial auto policy, which provides coverage B.

Scenario 1: Bob was walking near his home when the accident occurred. He is covered for his injuries.

Scenario 2: Bob was walking near the pyramids in Egypt when the accident happened. He is not covered for his injuries.

Scenario 3: Bob was riding his bicycle when the accident occurred. He is not covered because he was neither a pedestrian nor in an automobile at the time.

B. The only covered medical expenses are as follows:

· X-ray services	· ambulance	· funeral
· dental services	· surgical services	· drugs
· professional nursing	· medical services	· hospital services
· surgical supplies	· prosthetic devices

C. Who Is an Insured – Coverage B

Only insureds are eligible to receive payments under this endorsement. There are three categories of insureds:

1. The named insured is considered an insured whenever they are occupying any auto. Additionally, the named insured is also considered an insured if they are hit by an auto while walking as a pedestrian.

NOTE: This technically applies only to an individual named insured. Corporations, associations, partnerships, and limited liability companies are legal entities and not persons. As a result, they cannot literally occupy a vehicle or sustain injuries.

2. Family members of the named insured are insureds only if the named insured is an individual. Each family member is covered while occupying any auto or while struck by an auto as a pedestrian.

3. Any individual not specified in items 1. or 2. above, who is occupying a covered auto. If a covered auto is out of service and someone uses a temporary substitute, that person is also an insured. A substitute vehicle situation occurs when the covered auto has sustained a loss, broken down, is under repair or service, or has been destroyed.

Example: Continuing our example above, Bob Jones is the named insured on the policy.

Scenario 1: Bob’s daughter Carol, who lives at home and attends college, was walking to class when she was struck by a car. She is covered.

Scenario 2: Carol is driving a car covered under a commercial auto policy, and she is accompanied by five of her friends. All of them are covered for injuries when an accident occurs.

Scenario 3: John, Bob’s employee, is injured while driving his personal vehicle. Coverage only applies if John was using that vehicle as a substitute for a covered auto under Bob’s policy.

PART II B – SUPPLEMENTAL COVERAGES

The Commercial Auto Coverage includes four supplementary coverages. These do not alter or expand any policy terms, such as the Limits of Liability or applicable Exclusions, unless explicitly specified.

1. Defense Coverage

A. The insurance company will defend any civil proceeding brought against an insured, but only if the damages are covered by the insurance provided by this policy. The insurance company will have sole responsibility for choosing counsel.

To ensure this is understood, the policy states that the insurance company has no duty to defend or even to investigate a claim if either or both of the following apply:

· The suits or claims are not covered by the policy, or the allegations in a suit are not covered by the policy.

· The applicable limit of liability has been exhausted through payments or settlements.

B. The investigation and settlement of claims are entirely within the control of the insurance company. There is no requirement that the named insured or any insured be consulted before settlement.

Example: A messy car accident happened, and Jerry is being sued by the other driver. Jerry insists he did nothing wrong and believes the other driver was entirely at fault. He looks forward to explaining the events in court. However, his insurance company decides to settle the case to avoid ongoing litigation.

Jerry still has the option to pursue his claim against the other driver, but he cannot prevent his insurer from settling unless he takes control of the case himself and rejects all coverage and defense from the insurer.

C. Defense payments are separate from the liability limit and are covered by the insurance company. The defense expenses covered include:

1. All expenses the insurance company incurs.

2. Interest on the entire judgment amount accrued after the judgment is entered. Once the insurance company pays, offers to pay, or submits its share of the judgment to the court within its limit of liability, it no longer pays any interest.

3. Prejudgment interest when it is awarded against the insured for the portion of the judgment covered by the insurance company. However, if the insurer offers to pay their limit of liability, they will not pay any prejudgment interest for any period after that offer.

4. All costs charged to the insured, but these costs do not cover attorney’s fees or expenses taxed against the insured.

5. The cost of appeal bonds or bonds needed to release attachments in lawsuits filed against the insured is covered, but only up to the policy limits. The insurance company is not obligated to provide these bonds.

6. If a bail bond is required for a covered accident, up to $250 is available to cover its cost. The bond can be for a traffic law violation, but only if it is connected to the covered accident. The insurance company is not required to provide any of these bonds.

7. The insurance company covers reasonable expenses the insured incurs during any loss-related investigation or defense. However, compensation for lost earnings is limited to the actual loss, with a maximum of $250 per day. Expenses are paid only if the insurance company requests the insured to assist.

When the insurance company gives written approval, a suit includes the alternative dispute resolution processes that the insured must or may choose to participate in.

2. Contractual Coverage

A. When the named insured assumes liability of others to pay damages under written or oral contracts, liability coverage extends to include that liability, but only if all of the following conditions are met apply:

· The damages pertain to third parties, not to the insured's indemnitee.

· The assumption of liability needs to be explicitly stated rather than implied.

· The damages are due to bodily injury or property damage.

· The bodily injury or property damage is covered under this insurance.

· The contracts are made in connection with the named insured’s business covered under the policy.

· The bodily injury or property damage occurs after the contract was executed.

B. Insured Contracts

Coverage applies only to the types of contracts (oral or written) outlined below.

1. Obligations mandated by ordinance or law when the contract's purpose is to indemnify a municipality. This does not relate to actual work contracts for the requesting municipality. Item 6. below would apply if the contract is with the municipality.

2. Easements, but does not include those involving construction or demolition on or within 50 feet of a railroad. Additionally, the assumption of tort liability for such cases is also excluded under Paragraph 6.

3. Leases of premises

4. Sidetrack agreements

5. The section of a contract relating to leasing or renting an automobile to the named insured or their employees. However, it does not include the responsibility to pay for property damage to leased or rented automobiles.

Example: Pamela rents a car for a company convention and signs a rental agreement. After making a wrong turn, she hits a bridge. The bridge damage is covered by her company’s commercial auto policy, but the damage to the rental car is not, since responsibility for that damage was specified in the rental contract.

6. That part of other contracts, outside of Paragraphs 1 through 5, in which the named insured explicitly agrees to assume tort liability with another party.

NOTE: Tort liability arises when liability is imposed by law due to the absence of a contract.

C. Contracts Not Insured

This Supplement does not cover the following contracts, agreements, or parts of contracts.

1. A hold harmless agreement when given to a party transporting property by auto for hire. It applies only when the agreement is provided by the named insured and when the named insured will use a covered auto on a specific route or territory authorized by a public authority.

2. Any loan, lease, or rental contract or agreement for the rental, leasing, or borrowing of an auto with a driver. This pertains to such contracts entered into by the named insured or its employees.

Trigger Contractual Coverage Limitations

When MCA 501 appears as an endorsement on the Declarations, this supplement is applicable only to written contracts submitted to the insurance company within 60 days of signing.

When MCA 502 appears as an endorsement on the Declarations, this supplement applies only to written contracts.

NOTE: Endorsements MCA 501 and MCA 502 are called Trigger Endorsements. Instead of attaching an extra piece of paper called MCA 501 or MCA 502, the wording for that endorsement is built into the policy. This is unique to MSO policy writing.

Related Article: , MSO Commercial Auto Coverage Trigger Endorsements

3. Individual Named Insured Coverage

Coverage A – Liability to Others automatically extends to any named insured who is an individual as follows:

A. If a private passenger-type auto is owned by the named insured and qualifies as a covered auto under Coverage A, the following applies:

1. Family members operating owned vehicles are considered insureds.

An amendment is made to the 'Who Is An Insured' section of the policy, specifically in Item C under Part II A – Main Liability Coverages. This extension adds family members as insureds for the named insured's covered private passenger vehicles. Additionally, family members are also insureds for other vehicles furnished and available for both the named insured and family members' regular use.

Example: John Smith and Maximus Furniture, Inc. are the named insureds on the policy. John Smith owns a single private passenger vehicle in his own name, whereas the remaining nine vehicles are owned by Maximus Furniture, Inc.

Scenario 1: John’s wife is driving John’s owned vehicle. She is an insured.

Scenario 2: John’s resident daughter is driving a Jeep owned by Maximus Furniture. She is an insured.

Scenario 3: John’s ex-wife is driving a van owned by Maximum Furniture. She is not an insured.

2. Any nonowned autos are considered covered when used by the named insured or family members. However, this does not apply in the following circumstances.

· The auto is owned by any family member.

· The auto is furnished to the named insured or a household family member for regular use.

· The auto is used by the named insured or a family member involved in parking, repairing, selling, servicing, or storing autos. This applies only if the named insured or family member is part of that business.

· A non-private passenger type vehicle used by a named insured or family member while working in “any other business or occupation."

3. The Pollution / Environmental Damage Exclusion specified in Part II C – Liability Not Insured does not apply to any covered auto classified as a private passenger type vehicle.

B. The Fellow Employee exclusion does not apply to the named insured or any family members.

Paragraph D of the Employee, Employment, and Related Injury Exclusion is removed for bodily injuries to the named insured or any family member’s fellow employees. With the fellow employee exclusion deleted, coverage now extends if the named insured or a family member hits one of the named insured's employees or an employee at any place where they work.

Example: Sheila speeds through a corner and accidentally hits Jared, her coworker, as he is leaving the back of the restaurant where they work. She has coverage for the injury under her father’s commercial auto policy because Jared is an employee and she is a family member.

4. Out-Of-State Coverage Extensions

This section describes two key coverage extensions for when an insured is outside the state where the auto is licensed or garaged and within the coverage territory. These extensions ensure the insurance aligns with any state-specific laws on financial responsibility, no-fault, or other compulsory coverage.

The two extensions are as follows:

A. The limit of insurance under Coverage A – Liability to Others is automatically adjusted to comply with the mandatory or financial responsibility limits in the jurisdiction where the auto is used. However, this extension does not apply to laws regulating motor carriers, passengers, or property.

Example: Felix’s commercial auto liability limit is $50,000, complying with the state laws where his vehicles are licensed and garaged. One of his employees crosses into another state and causes an accident. That state’s minimum liability limit is $75,000. As a result, the coverage available for the accident increases to $75,000 due to this extension.

B. The required minimum coverage amounts and other types of coverage, such as first-party benefits or no-fault coverage, mandated by the jurisdiction where the vehicle is operated.

NOTE: A statement in this section clarifies that the insurance company will not pay multiple times for the same loss because of these extensions. In other words, it prevents coverage duplication and prevents damages from being collected more than once.

PART II C – LIABILITY NOT INSURED

The insurance company will not cover any type of costs, damages, expenses, or liability—whether directly or indirectly, fully or partially—if they are worsened by, caused by, or result from any of the following exclusions, even if a covered accident contributes concurrently or sequentially, unless the policy states otherwise.

1. Care, Control, or Custody Exclusion

Damage to property owned, transported, or in the care, custody, or control of the insured is not covered unless such liability was assumed in a written sidetrack agreement.

NOTES:

The Commercial Auto Coverage protects an insured against negligence and tort liability to others, but it does not cover damages or injury to the insured. This emphasizes the importance for the insured to keep their premises and properties well-maintained and to exercise reasonable care to avoid damage or injury, including to property in their care, custody, or control.
A sidetrack agreement involves the owners of a premises and a railroad regarding a railroad sidetrack (transfer or access track) on the insured's premises. The railroad allows the premises owner to use the sidetrack if the owner guarantees the railroad access to the sidetrack and agrees to certain property maintenance conditions. It may also include specified hold-harmless conditions between the owner and the railroad.
The Commercial Auto Coverage does not include endorsements for property in the insured’s care, custody, or control, or property being transported by the insured. However, various inland marine coverages are available to address these exposures.

Related Articles:

AAIS Motor Truck Cargo Legal Liability Forms

ISO Motor Truck Cargo Carriers Coverage Forms

2. Completed Operations Exclusion

Coverage does not apply to any bodily injury or property damage due to the insured’s work after it has been completed or abandoned. Work includes any tasks the insured performs or is performed for them by others, along with materials, parts, or equipment supplied for those tasks. It also includes any warranties or claims regarding the fitness, quality, durability, or performance of items related to the work.

The named insured's work is considered completed at the earliest time of any one of the following:

All work specified in the contract for the named insured has been completed.
All work required at a job site is finished. This applies when a contract involves multiple sites.
When work performed at a job site is put to its intended use by any party. However, if the work is used by other contractors or subcontractors on the same project, it is not regarded as completed.

If the insured's work involves service, maintenance, correction, repair, or replacement but is otherwise finished, it is considered completed.

3. Contractual Liability Exclusions

Damages for bodily injury or property damage resulting from liability the insured assumed in any type of contract or agreement (oral, written, or implied) are excluded, with two exceptions.

Coverage applies if the liability would have existed without the contract.
Coverage provided in Part II B – Supplemental coverages – 2. Contractual Coverage. However, this excludes any bodily injury or property damage that occurred before the contract was established.

4. Employee, Employment, and Related Injury Exclusions

A. Workers Compensation and More

Coverage does not apply to any requirements or obligations that the insured must comply with under laws such as workers compensation, disability benefits, unemployment compensation, or similar law.

NOTE: This exclusion prevents double indemnification for an injury that should be covered by workers compensation or employers liability coverage.

B. Employment Practices and Employers Liability - Employee

Bodily injury to the insured's employee due to their employment or while performing job duties is excluded.

C. Employment Practices and Employers Liability – Employee’s Family

Coverage excludes bodily injury to the named insured’s employees' brother, child, parent, sister, or spouse resulting from any injury described in Paragraph B. above.

D. Fellow Employee

Employees are regarded as insureds under the policy. Therefore, exclusions B. and C. might be bypassed if an injured employee sues a coworker responsible for the accident. However, this exclusion prevents the policy from covering such lawsuits. Bodily injury to a fellow employee of the insured that occurs as a result of or in the course of that employee’s employment with the named insured is excluded.

Additionally, the policy excludes any claims or lawsuits brought by relatives of any fellow employee seeking retribution due to an insured's actions during employment. Relatives include, but are not limited to, brothers, sisters, children, parents, or life partners.

E. Third Party Obligations

Exclusions B., C., and D. above apply even if there is an obligation to share or repay others for damages from such injuries.

NOTE: These obligations should be addressed through Employers Liability Coverage found in the Workers Compensation Coverage Form or Stop Gap Coverage.

Related Articles:

WC 00 00 00 C–Workers Compensation and Employers Liability Insurance Policy Analysis

Stop Gap–Employers Liability Coverage

Exclusions B, C, D, and E apply regardless of who files the suit. They remain in effect even if an employee sues the insured for reasons other than being an employee of the named insured.

The only exceptions to this absolute statement are the following:

· Liability assumed in a contract covered under Part II B – Supplemental Coverages – 2. Contractual Coverage.

· Domestic Employees. However, this exception applies only if the domestic employee is not eligible for workers compensation benefits.

NOTE: Some states do not classify domestic employees as subject to workers compensation, so this exception would apply. However, other circumstances might also render the employee ineligible.

5. Endangerment or Harm Exclusion

Any bodily injury or property damage resulting from an insured's intentional harm is not covered. Similarly, damage caused by an insured knowingly risking harm to property or people is also excluded.

NOTE: This exclusion aims to shield insurance companies from covering damages or injuries intentionally caused by the insured. It serves the public interest by preventing insurance from being exploited for profit, harming competitors, serving as a tool for revenge, or causing other deliberate harm.

Related Court Case: Road Rage Triggers Coverage Dispute

Example: Jason is driving the Favorite Flowers Van when he witnesses a hit-and-run. Fury overtakes him, prompting him to chase the fleeing vehicle. He chooses to accelerate and ram the car to force it to stop. The damage incurred is not covered.

6. Explosives Exclusion

If an explosive that is made, sold, or transported by the named insured explodes, any bodily injury or property damage resulting from that explosion is not covered.

7. Handling or Movement of Property Exclusion

This exclusion works in conjunction with commercial general liability coverage forms to prevent duplication of coverage and place the event squarely into one coverage form.

Bodily injury or property damage due to the handling or moving of any property is excluded as follows:

A. Before the property has been moved into or onto the covered auto after its acceptance.

B. After the property is transferred from the covered auto to its final destination.

C. When the property is moved by mechanical devices not attached to the covered auto. However, this does not include when the property is moved by a hand truck. In other words, loading or unloading using conveyors, mobile carts, forklifts, or other mechanical devices—except for a handcart—is excluded but may be covered under the commercial general liability coverage forms.

Example: The local school board ordered several pizzas and other food. Jesse, the driver, delivers the food to the reception area and waits for Rhonda, the receptionist, to accept the delivery. She confirms the order is correct and asks if he can help her set up the food since no one else is available. Jesse agrees, but while assisting, he trips, sending the pizzas flying, damaging property, and causing injuries.

None of Jesse's damages are covered under the commercial auto policy because the delivery was considered complete once he left the food at the reception area.

8. Operations of Equipment Exclusion

A. Bodily injury or property damage caused by the following equipment, when operated and permanently attached to an auto, is not covered:

· Air compressors	· Sprayers	· Lighting
· Generators	· Pumps	· Welding equipment
· Building-cleaning equipment	· Geophysical exploration devices	· Well servicing equipment
· Any device used to lower or raise workers, such as a cherry picker

B. This item applies only if all of the following apply:

· If the vehicle qualifies as mobile equipment under the mobile equipment definition.

· The state requires that certain types of mobile equipment be subject to financial responsibility or compulsory laws.

· The equipment is garaged in a state with such laws.

Losses from bodily injury or property damage caused by mobile equipment while permanently attached to a vehicle described in A. above are not covered.

NOTE: Coverage for equipment operations is provided under the ISO CGL Coverage Form. This exclusion avoids overlap with the Commercial Auto and CGL coverage.

Related Court Case: Business Auto Insurer Must Reimburse CGL Insurer

9. Pollution /Environmental Damage Exclusion

The term “pollutants” is defined in Parts II and III of the Common Glossary. Understanding what pollutants are is crucial when reviewing this exclusion. This exclusion is divided into several parts to clearly explain what is excluded.

A. Coverage excludes any bodily injury or property damage caused by pollutants, including discharge, dispersal, seepage, migration, release, leakage, or escape. It also does not cover bodily injury or property damage resulting from related environmental issues. This exclusion applies whether the event actually occurs or if the bodily injury or damage is based on a threat or allegation that such an event has occurred.

This exclusion is applicable regardless of the location or manner in which the event occurs.

However, there are some exceptions to this exclusion, so the following items specify where and when coverage is excluded.

1. No coverage applies when the pollutants or the property that contains the pollutants are:

a. handled, transported, towed, or moved into, onto, or from the covered auto.

b. in transit, the insured may be providing the transit, or others may provide the transit on behalf of the insured.

c. in or upon the covered auto while being treated, processed, stored, or disposed of.

2. No coverage applies before the pollutants or property containing the pollutants is moved from the place where the insured accepts it, with the intent to move it into or onto the covered auto.

NOTE: This is similar to Exclusion 7. – Handling or Movement of Property exclusion.

3. No coverage applies after the pollutants or the property containing the pollutants are moved from the covered auto to the final location where the insured is disposing of, delivering, or abandoning the pollutant or the property containing the pollutant.

Example: Kenny is transporting hot tar from one job site to another. He makes a sudden stop to avoid hitting a bunny, and the chain holding the hot tar breaks, causing the tar to fly into the nearby pond. The property damage to the pond due to the introduction of the tar pollutant is not covered.

B. Exceptions

Paragraph A of the exclusion does not apply to exhaust, fumes, fluids, fuels, lubricants, or similar pollutants that are necessary for or result from the normal electrical, hydraulic, or mechanical operation of a covered auto or its parts, provided that both of the following apply:

1. The pollutants must have been within an auto part designed by the manufacturer to hold, store, receive, or dispose of the pollutants prior to the accident.

2. The bodily injury or property damage was not due to the operation of any of the following items permanently attached to an auto:

· Pumps	· Generators	· Sprayers
· Lighting	· Air compressors	· Welding equipment
· Building cleaning equipment	· Well servicing equipment
· Any device used to lower or raise workers, such as a cherry picker	· Geophysical exploration devices

Items A. 2. and A. 3. within this exclusion do not apply when an accident occurs away from an insured’s owned, leased, or rented premises and involves pollutants not on or upon a covered auto. For this exception to apply, both of the following conditions must be met:

1. Pollutants or any property containing them are damaged, overturned, or upset due to the maintenance, operation, or use of a covered auto.

2. The release, dispersal, emission, escape, flow, leakage, migration, or seepage of pollutants directly results from such damage, overturn, or upset as described in item 1. above.

Example: Peter was backing into position at the warehouse when his truck suddenly lurched. It hit the loading dock, causing the item he was supposed to receive to discharge and release pollutants. Since this incident happened before the pollutants were loaded onto Peter’s truck and resulted from his accident, his commercial auto policy will cover the pollution event.

C. Cleanup-related Expenses

Cost, expense, liability, or loss due to any of the following is excluded:

1. Demands, directives, orders, or requests from any source to any insured for actions related to pollutants, such as cleanup, containment, detoxification, monitoring, neutralization, removal, testing, or treatment.

2. Governmental authorities bringing suit or claims seeking actual damages or reimbursement for costs related to accessing or managing pollutants. Such actions could include cleanup, containment, detoxification, monitoring, neutralization, removal, testing, and treatment.

Section C. does not apply to pollution costs or expenses due to accidents covered in Paragraph B. of this exclusion.

An important condition follows. The cleanup-related expense is only covered if the same accident caused the bodily injury or property damage.

10. Professional Activities

No coverage applies to bodily injury or property damage caused by the following circumstances:

Any type of professional advice, product, or service is excluded from coverage. This includes both the provision of such advice or services and any failure or refusal to provide them. The exclusion also applies to any food or drink related to professional services.
The handling of a body after death.

Example: When the casket was loaded into the hearse, the latch was not securely fastened. As Patrick, the driver, turns the corner, the latch releases, opening the door. Patrick does not realize the door has opened, but the family behind him notices. They see the casket gradually emerge. Fortunately, Patrick is warned and pulls over. The family then sues the funeral home for the trauma caused when the latch failed.

The Commercial Auto policy will not cover the claim, but a funeral director’s professional liability policy will most likely cover a loss of this type.

11. Racing Exclusion

This exclusion applies only to prearranged contests and their preparation or practice. Bodily injury or property damage related to such demolition, racing, speed contests, or stunt activities is not covered.

12. Sales Exclusion

This exclusion applies only to covered autos used as either a mobile showroom or a store.

This is an auto policy, not a general liability policy; therefore, there is no coverage for injury or damage caused by items the insured sells, manufactures, rents, or distributes once those items are no longer in the insured's possession.

13. Wrong Delivery of Liquid Products Exclusion

Bodily injury or property damage from any of the following is not covered if it occurs after the delivery of a liquid product has been completed:

The liquid was delivered to the incorrect address
The liquid was placed into the wrong receptacle
The liquid delivered was not the one that was supposed to be delivered.

A delivery is considered complete even if corrections are required due to a misdelivery.

NOTE: This means that if bodily injury or property damage occurs during delivery, coverage applies. However, once the product is delivered, there is no coverage. Misdelivery of a product should be covered under the Commercial General Liability coverage form.

Example: Klutzy Floyd delivered fuel oil to several different customers:

Scenario 1: The address was 5853 Main St, but he became confused and delivered the product to 5853 Mainville St. Both addresses had receptacles, but 5853 no longer had a fuel tank, and the oil filled the basement. Because the property damage occurred during the delivery, it is covered.

Scenario 2: Floyd struggled to pour the fuel oil into what he believed was the correct container, but it turned out to be the kitchen waste oil receptacle. Although the oil owner didn’t notice at first, the issue became apparent later. Since the damage occurred after the delivery, it is not covered.

Scenario 3: Floyd was confused and believed he was delivering diesel fuel, but he was actually delivering fuel oil. The damage to tractors caused by receiving fuel oil instead of diesel is not covered, because it happened after the delivery.

THE FOLLOWING ADDITIONAL EXCLUSIONS APPLY ONLY TO COVERAGE B – MEDICAL PAYMENTS

NOTE: The previous 13 exclusions also apply to Coverage B- Medical Payments. The following exclusions are specific only to Medical Payments.

14. Auto Business Exclusion

Coverage does not apply to any insured who sustains bodily injury while working for a business that sells, repairs, services, or parks autos, unless it is the insured's own business.

15. Other Vehicle Exclusion

Medical expenses are not covered for bodily injury sustained by the named insured or a family member while either in a vehicle or as a pedestrian when struck by a vehicle not covered under this policy, and meets either of the following criteria:

Owned, furnished, or available for regular use by the named insured.
Owned, furnished, or available for regular use by a family member.

NOTE: These exclusions attempt to eliminate duplicate coverage and primary versus excess claims handling situations.

Example: Percy bought his own car and is carrying only the minimum liability limits. His father, Kelly, insures all his company vehicles under his Commercial Auto policy. Kelly pulls out of the garage just as Percy pulls in, injuring both Kelly and Percy. Neither has medical payments coverage under Kelly’s commercial auto policy.

16. Used as a Premises Exclusion

Medical expenses are not covered for bodily injury to an insured while occupying a vehicle not being used as an auto, but rather as premises.

NOTE: This exclusion could raise concern. The terms “located” and “premises” are not clearly defined, and the point at which a vehicle “locates” and becomes a "premises" is unclear.

Example: Paul is donating blood at a bloodmobile. He faints upon standing and hits his head. Although he has medical payments coverage as an insured individual, it does not apply because the vehicle he was injured in was being used as a premises, not as an auto.

17. Used Without Permission Exclusion

Medical expenses are not covered for bodily injury to anyone using a vehicle unless that person reasonably believes they have the right to do so.

18. Your Medical Services/General Medical Exclusions

A. Medical expenses related to medical services the named insured, the named insured’s employees, or those contracted by the named insured to provide are not covered. This exclusion applies even to first aid provided at the time of an accident.

B. Medical expenses related to any bodily injury otherwise excluded under this policy.

PART II D – SPECIAL LIABILITY CONDITIONS

1. Duties of Insureds – What to Do In Case of Accident, Claim, Injury, or Suit

The duties listed below must be carried out by the named insured, other insureds, and anyone else who benefits from this insurance.

A. If a claim occurs or is likely to occur, the insured must notify the insurance company immediately. The notification should include all of the following details:

· Provide the named insured.

· How, when, and where the accident or injury occurred.

· Circumstances surrounding the accident or injury.

· Names and addresses of any injured persons or witnesses.

o This is especially important if known.

B. The insurance company expects to receive all bills, documents, notices, papers, and court summons promptly when related to a suit or claim. This requirement also extends to medical expense claims.

C. Cooperate with the insurance company during the investigation, settlement, or defense of a claim or suit. This includes offering assistance while the insurance company is handling a case, such as:

· Attending hearings and trials.

· Providing evidence.

· Support the insurance company in asserting rights of contribution or seeking indemnity from third parties.

· Assist in securing witnesses to testify and supply information and records when needed.

D. When asked, be prepared to undergo an examination, including swearing an oath if required.

· The insurance company may also request the named insured's signature and a formal declaration.

· If multiple people need to be examined, they can be examined individually.

· Any examination could be recorded on video.

E. No commitment can be made as to whether or what the insurance company will pay unless the insurance company has granted written permission in advance. Similarly, no obligations are to be made or expenses incurred on behalf of the insurance company unless the insurance company has granted written permission.

Payments, obligations, and expenses made without permission of the insurance company are the responsibility of the named insured.

F. When the claim is for Medical Payments – Coverage B, beneficiaries must:

· Submit a written proof of claim. This can be required under oath.

· Provide authorizations allowing the insurance company to access medical records or other relevant information.

· Claimants must consent to examination by a physician appointed by the insurer whenever requested.

· The requests should be reasonable, and the insurance company is required to cover all examination costs.

Failure to perform the duties described in A. through F. above may result in serious consequences, including the voiding of all coverage.

NOTE: Although the related court case below does not involve commercial auto, it illustrates what can happen to a party that fails to comply with such provisions.

2. Limits of Liability

The most the insurance company will pay for all damages from a single covered accident is specified in paragraphs A, B, and C that follow. These limits apply regardless of how many insureds, covered vehicles, involved vehicles, premiums paid, or claims filed. Once these limits are reached through settlements or judgments, the insurance company's obligations for that accident are fully satisfied.

A. Accident Limits – Coverage A

The most to be paid under Coverage A is the Accident Limit shown on the Declarations. This is the maximum amount payable in a single accident.

NOTE: Since there is no aggregate limit, the Accident Limit listed on the Declarations applies to each separate incident. This means the available coverage resets for each new incident, including the second, third, and subsequent accidents.

B. Accident / Per Person Limits – Coverage B

The maximum amount payable to a person in a single accident under Coverage B is the Per Person Limit shown on the Declarations. This is the most that will be paid for any one person in a single accident. This means that if multiple people are injured in a single accident and are eligible to receive payment, each has access to their own per person limit.

C. Application of Limits

The limits apply individually to each consecutive 12-month period unless a standard 12-month policy period is endorsed to extend the policy period.

The policy period begins on the date specified in the Declarations.

1. A policy is issued as a standard 12-month policy term

Policy limits apply to the 12-month policy term.

2. A policy is issued for more than 12 months, for example, a 27-month policy term

This is a policy issued with a term period greater than 12 months at its original issue. Since this policy period cannot complete a full 3 consecutive 12-month periods, the final 3 months of the policy period will have its own policy limit.

Example: Here’s how the policy limits apply when a policy is originally issued for more than 12 months. We’ll use the 27-month policy period:

· The first 12 months of the policy period receives its own policy limit;

· The second 12 months of the policy period receives its own policy limit; and,

· The remaining 3 months of the 27-month policy period receives its own policy limit.

There are essentially three separate policy limits that will apply.

· A policy is originally issued for 12 months but extended at renewal by an endorsement

This policy is issued for a standard 12-month term, but upon renewal, the policy period is extended beyond the 12-month period through an endorsement. This is similar to how a short-term policy would function.

o The original 12-month policy period has a dedicated policy limit.

o Subsequently, both the renewal 12-month period and the 3-month extension period made by endorsement share a single policy limit. This is due to the extension period being added by endorsement rather than being part of the original policy period when the policy was issued.

NOTE: The policy refers to a terminal period. A terminal period is the final duration of a policy, which can last from one day to several years before coverage ends.

Under this policy and any additional Uninsured or Underinsured Motorists Coverage, no individual is allowed to receive duplicate payments for the same elements of damages, expenses, or losses.

3. Other Conditions

A. The coverage under this policy applies individually to each insured and each named insured. This means if multiple insureds and named insureds are involved in a single legal action, the insurance company will treat each one as if they were the only party named in that action.

Exceptions apply in the following situations:

· Except for the limits of liability as described in Paragraph 2. – Limits of Liability; and,

· Any duties and/or rights stated to apply specifically to the first named insured apply only to that first named insured and not to any other.

B. If the insured becomes bankrupt, the insurance company is required to continue all obligations under the policy.

PART III A – MAIN PHYSICAL DAMAGE COVERAGES

Insuring Agreement

A. The insurance company provides coverage only if a limit of liability and premium is specified on the Declarations. All coverage is subject to the terms and conditions outlined in the policy.

B. Coverage applies only to losses occurring within the designated coverage territory and during the policy period, unless specified otherwise in the policy. For more information, refer to Common Conditions – Part III–6.–Coverage Territory.

Example: Jeremy was driving his company’s car when he was in an accident. The policy term was 8/1/2025-8/1/2026. The mailing address is in Cambridge, Massachusetts.

Scenario 1: Jeremy hit a bridge on 8/1/2026 at 11:30 PM while in California. The policy does not cover the accident because the loss occurred on 8/2/2026 at 2:30 AM at the mailing address listed on the Declarations.

Scenario 2: Jeremy was on a side trip to Mexico when he hit an abutment. The policy does not cover the accident because Mexico is outside the coverage territory.

C. Insuring Agreement Qualification

The coverages listed below are subject to specific exclusions and limitations, including the General Exclusions and Part III D—Special Physical Damage Conditions.

NOTE: There are no General Exclusions, but there are Common Exclusions – Parts II and III, with Part III being specifically noted in this section.

Coverage F - Comprehensive Coverage

Coverage applies to any source of damage to a covered auto and its equipment, except when the damage results from a collision with another object, an overturn, or a cause of loss excluded or limited by the policy.

NOTE: See Part III – Supplemental Coverages Section—2. Falling Objects, Glass Breakage, Impact with an Animal/Bird, for additional information concerning impact with an animal or bird.

Coverage G - Collision Coverage

This coverage is very specific. The only covered losses are those caused by the covered auto colliding with another object or overturning.

NOTE: Another object could be another vehicle, a person, a tree, a building, a sign, etc.

Coverage H - Towing

This coverage applies only to private passenger-type autos.

Towing and labor costs when a covered private passenger auto becomes disabled are covered. Only labor performed at the disablement site is paid; costs after the vehicle is towed to the repair shop are not covered.

Example: Patricia is driving her auto for Masquerading Clowns. Her vehicle suddenly stops running, so she calls for help.

Scenario 1: The tow truck driver who responds to the problem in Patricia’s SUV is also a mechanic. He inspects the engine, identifies a simple problem, and fixes it. All associated costs are covered, up to the limit of liability on the Declarations.

Scenario 2: The tow truck driver who responds to the problem with Patricia’s 2-ton truck is a mechanic. He inspects the engine, identifies a simple issue, and fixes it. There is no coverage because a 2-ton truck is not classified as a private passenger-type auto.

PART III B – SUPPLEMENTAL COVERAGES

Supplemental Coverages – Additional Conditions

The insurance company provides the following Supplemental Coverages as extensions of the main coverages, but only when and to the extent the main coverages apply. They do not change or waive any policy provisions unless explicitly stated and remain subject to all underlying policy terms unless specifically changed by this section.

1. Certain Electronic Equipment Coverage

Coverage is extended to the following equipment:

NOTE: This is significant because of how electronic equipment is excluded under Part III C – Exclusions/Limitations. As a result, this should be considered more as an exception to that exclusion rather than genuine additional coverage.

A. Equipment installed permanently in the vehicle. This includes devices solely designed for video, sound reproduction, or GPS. Accessories used with any of this equipment are also covered, provided they are installed permanently.

B. Removable equipment with a permanently installed housing unit is covered. It must be designed only for video, sound, or GPS purposes. Accessories used with such equipment are also included if they are stored within the same permanently installed housing unit. Additionally, the equipment must draw power from the vehicle's electrical system.

C. Other electronic equipment that meets either of the following criteria is covered:

· Essential for the vehicle's operation or for monitoring its operating system.

· An essential part of the same unit that houses any sound-reproducing equipment described in the preceding Paragraph A and is permanently installed in the vehicle's dashboard or console opening, typically used by the manufacturer for radio installation.

Example: Cornelius has customized his Kia Soul by installing speakers in the back to use it as a sound system for advertising events. In the event of an accident, insurance coverage includes the permanently installed upgraded sound system. However, the speakers and other equipment in the rear are not covered since they are not permanently installed.

2. Falling Object, Glass Breakage, Impact with an Animal or Bird

This item applies only when Comprehensive Coverage applies to the damaged covered auto.

The insurer pays the following losses under Comprehensive coverage:

A. Glass breakage

B. A loss resulting from an object or missile falling on the covered auto.

C. A loss that occurs when an animal or bird hits the covered auto.

When glass breakage is part of a collision loss or an overturn, the insured may elect to have the loss paid under either collision or comprehensive coverage.

NOTE: This item explains the coverage details. The three loss types discussed might be termed collisions because an object hits the vehicle. This distinction is crucial because of the differences in deductibles and coverage. When collision coverage is included, its deductible is typically much higher than the comprehensive deductible. Sometimes, comprehensive coverage may be the only physical damage coverage on the vehicle.

3. Individual Named Insured Coverage

A. This coverage is automatically available to any named insured who is an individual.

1. Physical damage coverage for nonowned private passenger autos is included when physical damage coverage is provided for owned private passenger autos.

2. The most paid for loss to a nonowned trailer is $500.

B. Glossary

The term "nonowned auto" in this supplemental extension refers to any private passenger type auto, pickup, van, or trailer that is not owned by, available to, or used regularly by the named insured or a family member. This includes situations in which the vehicle is operated by or in the custody of the named insured or a family member.

Example: Pat borrowed a friend’s trailer to pick up mulch for landscaping the outside of his office building. He didn’t handle the trailer well and ended up smashing it against a wall. Up to $500 is available to pay for the damage to that trailer.

4. Transportation Expense Coverage – Additional Insurance

A. This is a conditional extension. It applies only if all the following conditions are met.

· The covered auto is a private passenger type.

· Comprehensive coverage is provided for the covered auto.

· The entire covered auto is stolen.

B. When all the above conditions are met, temporary transportation costs of up to $20 per day are covered up to a maximum of $600.

The time period for coverage begins 48 hours after the theft and ends at the earliest of the following:

· The covered auto is returned and is available for use.

· The insurance company pays for the loss of the covered auto

The expiration of the policy period does not impact coverage under this item.

5. Hired Auto Loss of Use Coverage – Additional Insurance

This is a conditional extension. It applies only if all the following conditions are met:

A. Hired Auto Physical Damage coverage applies when:

· An insured borrowed, leased, rented, or hired a vehicle using a written contract or agreement.

· The contract makes the insured legally liable for damage to the rented vehicle.

· The vehicle rental does not include a driver.

· The loss of use is the result of damage covered under the policy provisions.

B. A maximum of $20 per day is available for the loss of use of a rented vehicle. The supplemental coverage is limited to $600. The period of time is not limited by the policy's expiration.

NOTE: Symbol 8 or 1 must appear beside Comprehensive and Collision on the Declarations for coverage to apply.

PART III C – EXCLUSIONS/LIMITATIONS

Coverage does not apply to the property or loss described in this section unless explicitly stated in the policy.

1. Electronic Equipment, Disks, and Tapes Exclusions

The following property is not covered:

A. Any type of electronic equipment capable of receiving, reproducing, or transmitting audio, visual, or data signals. This exclusion also applies to any accessories used with such equipment.

However, equipment permanently installed in a covered auto, or with a permanently installed housing unit, is covered. See Part III B - Supplemental Coverage – 1. Certain Electronic Equipment provides some coverage.

B. Cassette tapes, CDs, and similar media devices intended for use with audio, visual, or data electronic equipment.

C. Devices used to measure speed, such as radar and laser, as well as tools for jamming, detecting, evading, or interfering with these speed-measuring devices.

2. Farm Equipment and Tractors Exclusion

This exclusion applies only to farm equipment, machinery, or tractors covered by the policy. There is no coverage for losses to any of the following.

A. Any equipment that can be transported by the covered auto.

There are two exceptions:

· Equipment included in the covered auto’s delivered price.

· Equipment specifically described as a covered auto.

B. Equipment that is stationary but capable of being powered by the covered auto.

Example: Evelyn owns a tractor used for land maintenance around her large warehouse complex. Recently, she acquired different types of equipment that can be attached to the tractor. The tractor is a covered auto, but the equipment is not because it was not purchased with the tractor and is not described as a covered auto.

3. Racing Exclusion

This exclusion applies only to prearranged contests and to the preparation or practice for them. Damage resulting from demolition, racing, speed contests, or stunt activities is not covered.

Example: Evelyn loves driving her tractor and often works on it to boost its performance. She frequently joins other tractor enthusiasts for discussions. Some propose a tractor pull contest, and Evelyn eagerly signs up. During practice for the tractor pull, Evelyn loses her grip, sending the tractor into a ditch and causing damage. Since the damage occurred during practice for the competition, it is not covered.

4. Wear, Tear, and Other Specified Causes of Loss Exclusions

A. Coverage does not apply to loss or damage caused by any of the following:

· Corrosion · Freezing	· Decay or deterioration · Inherent vice
· Rust	· Latent defect
· Wear and tear	· Dry or wet rot
· Electrical or mechanical breakdown	· Tire blowouts, punctures, or other road damage to tires
· Deficiencies, errors, or omissions in design, materials, plans, or workmanship	· Natural growth such as fungi, mold, spores, mildew, bacterium and other similar growth

B. This exclusion has two exceptions:

· If a covered loss is the result of any items described in A. above, that resulting loss is covered.

· If an otherwise covered loss causes any of the items described in A. above, the resulting loss from that otherwise excluded loss is then covered.

5. Diminished Value

Loss of a covered auto's value because it was involved in an accident is not covered. Diminution in value is a defined term in Common Glossary – Parts II and III.

PART III D – SPECIAL PHYSICAL DAMAGE CONDITIONS

1. Duties When Loss/Danger of Loss Occurs

The duties listed below must be carried out by the named insured, other insureds, and any others who benefit from this coverage.

A. Report the Loss

The insured must immediately notify the insurance company of any loss. When a loss involves a violation of the law, such as theft or vandalism, the policy must be notified immediately.

Also, provide details about when the loss occurred, the location of the loss, and a description of the accident as soon as possible.

B. Protect Property

The covered auto must be protected if a covered cause of loss appears imminent. After a covered loss, the auto should also be safeguarded from additional damage. The insurance company will cover reasonable expenses required to prevent further harm to the auto.

Example: Perry recently bought a new car and is very eager to keep it undamaged. To that end, he takes several precautions.

Scenario 1: He has no garage, so he must park in his driveway. His neighbor has a tree from which limbs have been known to fall. Would the insurance company pay for an arborist to trim the limbs?

Scenario 2: He hears that a hailstorm is on its way, but has no garage in which to pull the car. Would the insurance company cover the cost of overnight parking in a parking garage?

Scenario 3: A hurricane is predicted, and evacuation is ordered. Would the insurance company pay his costs to evacuate, including his hotel and meals, while he is away?

C. Cooperation on the Loss

The insurance company may request or require the following items as often as they find necessary, provided it is reasonable.

· The insurance company must be able to inspect the damaged vehicle and gather details about the loss prior to repairing or disposing of it.

· All parties are required to agree to be examined under oath and sign any statement of answers if requested by the insurance company.

o If multiple individuals need to be examined, the insurance company may choose to conduct their examinations separately from others.

o Videos might be recorded during the examinations.

· Cooperation is required during the insurance company's investigation or settlement of the claim.

Failure to cooperate could lead to severe consequences, including the potential voiding of coverage.

NOTE: While the following case does not involve commercial auto, it demonstrates what can happen to a party that fails to comply with such provisions.

2. How Losses Are Settled

A. Limit of Liability

1. Coverage F- Comprehensive & Coverage G - Collision Coverages

The most paid for all loss or damage to a single covered auto damaged or stolen is the least of:

· The actual cash value of the property, which is determined as of the date of the loss, not the date of adjustment.

· The cost to repairing or restoring the property with items of similar kind and quality.

· The cost to replace the property with items of similar kind and quality.

Example: Patrick and the Less Than Cooperative Insurance Company have been at odds over coverage. After nearly 18 months, Less Than Cooperative finally concedes that Patrick is right about the coverage he should receive. However, a new dispute arises because the adjuster insists on paying the actual cash value as of the settlement date. Patrick counters that the actual cash value is based on the loss date, not the adjustment date.

2. Coverage H – Towing

The most paid in a single disablement is the limit specified on the Declarations.

B. Deductible

The insurance company covers the cost to repair, restore, or replace each covered vehicle's damaged or stolen property, less the deductible specified on the Declarations.

If a covered auto includes comprehensive coverage, there is no deductible for losses due to fire or lightning.

Example: Wildfires are spreading rapidly across the area, forcing Jalousies, Inc. to abandon its shop. The evacuation order is issued while all company vehicles remain on-site. Employees are focused on evacuating their families, and cannot be concerned with moving the vehicles. As the fires pass through, all the vehicles are destroyed. Fortunately, they are covered, and no deductible applies.

C. Appraisal

1. If the insurance company and the named insured cannot agree on the loss amount, either party can request an appraisal. Once a written demand is made, each side must, within 30 days, select a qualified appraiser and inform the other party.

2. The two appraisers must select a disinterested and qualified umpire within 15 days. If they do not, either party may ask a judge of a court of record to appoint the umpire.

3. The appraisers are to reach a mutually acceptable agreement on any disputed values. If they cannot reach an agreement, they refer their disagreements to the umpire. When two of the three agree, the decision is final and binding for all parties.

4. The insurance company and the named insured are each responsible for paying their own appraiser's costs, and they must share the expenses for the umpire and any other appraisal-related costs.

Related Court Case: Insurer Must Accept Decision of Its Approved Umpire

5. Even if the insurance company participates and consents to the appraisal process, it still has the right to deny the claim.

D. Our Liability and Satisfaction of Your Loss

This policy's coverage may not fully cover a loss. If that happens, the named insured is responsible for securing additional insurance available to cover the gap or pay the difference themselves using other available means.

E. Our Options in Settling Losses

The insurance company decides how to settle a physical damage loss and may choose from the following options:

1. Compensate with money for the loss.

2. Pay for repairing or replacing damaged or stolen property, or to take all or part of it at an agreed or appraised value.

3. Return stolen property if recovered, at the insurance company's expense. The insurance company will also cover any damage to the property resulting from the theft.

4. Any settlement will be made with the named insured, loss payees, or anyone else legally entitled to payment. If property of others is involved, the insurance company may settle the claim directly with that party. Once the claim is settled with the other party, it will also satisfy the named insured's claim for that property.

3. Loss Payable

A. The named insured and the applicable loss payee listed on the policy are paid based on their specific interest in the property for any covered loss. No payment will be made to the loss payee when the covered loss is due to conversion, embezzlement, or secretion but only when the named insured is the one who performs any of these actions.

NOTE: “Secretion" is when the insured intentionally hides insured property to deny the loss payee access or recovery. It’s similar to conversion and embezzlement—deliberate, dishonest acts.

B. The loss payee will be notified in the same way as the first-named insured if the insurance company cancels the policy. Once the policy is canceled, the insurance company's obligation to the loss payee ends on the cancellation date.

Example: Punctual Insurance issues a cancellation notice to Smith Paving, Inc. Despite Ned Money, Inc. being listed on the declarations as the loss payable, it does not receive the required notice.

Two days after the cancellation takes effect, three of Smith Paving’s vehicles are stolen. When Ned Money files a claim, Punctual must cover the loss because Ned Money was never sent the required cancellation notice.

However, if Punctual can prove that Smith Paving converted the cars, it may be able to avoid paying for this loss.

C. When the insurance company makes a payment to a loss payee, the loss payee is required to transfer their recovery rights for that loss to the insurance company.

4. No Benefit to Bailee

If a party with custody of covered property requires an assignment of coverage from the insured, the insurance company does not acknowledge that assignment, regardless of other provisions in this coverage form. This policy does not benefit any party with custody of the covered property.

COMMON EXCLUSIONS – PARTS II AND III

The exclusions listed in this section are in addition to the Exclusions located in Part II and Part III. They are absolute, meaning the insurance company will not cover any damage, expense, liability, or loss. These exclusions apply even if the damage or loss is directly or indirectly caused or worsened by the exclusions, including if they are partly responsible. They also apply if the exclusions are involved in the sequence of events or occur simultaneously with a covered loss or accident, which would otherwise be covered if not for these exclusions.

NOTE: Government/Legal/War and Nuclear/Radioactive are exclusions applying to both Parts II and III. However, the specific exclusions are unique to each part. By grouping exclusions into a single section, it is easier to understand their scope.

PART II – Liability Exclusions

1. Government / Legal / War Exclusion

A. War and similar military actions are not covered. This exclusion applies regardless of circumstances, such as a formal declaration of war. This means civil war, invasion, insurrection, rebellion, revolution, or power seizures are all excluded. Actions taken to defend against or hinder such actions are also considered war and are excluded.

Ultimately, there is no coverage for any loss directly or indirectly related to war or warlike activities.

B. The following actions, known to any insured, are also excluded:

· Violation of an ordinance or penal law committed by an insured or with their consent

· Statutory fines or liability

· Punitive or exemplary damages

· Illegal trade

2. Nuclear Energy Exclusion

A. Coverage A – Bodily Injury and Property Damage are excluded as follows:

1. For any insured who is also covered under ANY policy issued as a nuclear energy liability policy.

NOTE: This means coverage would likely be provided by one of the following:

· Nuclear Energy Liability Insurance Association

· Mutual Atomic Energy Liability Underwriters

· Nuclear Insurance of Canada

· A successor carrier to any of the above

This insured remains not covered, even after the limits under that nuclear energy policy have been exhausted, resulting in termination of coverage.

2. When bodily injury or property damage results from the hazardous properties of nuclear materials, coverage does not apply with respect to either of the following:

· A person or organization is required to comply with the Atomic Energy Act of 1954 to maintain financial protection or any amendments.

· The insured has the right to compensation from the United States of America or its agencies under any agreement between them, or would be available if this policy were not in place.

3. When it results from the hazardous property of nuclear materials under the following circumstances:

· The material is located at an insured-owned or operated nuclear facility, or it has been discharged or dispersed from such a facility. This applies even if the insured does not own or operate the facility, but another party does so on their behalf.

· The material is contained in spent fuel or waste that the insured, or others acting on their behalf, have handled in any way at any time. This includes material that has been disposed of, possessed, processed, stored, transported, or used by or for the insured.

4. An insured providing any services or supplies to a nuclear facility, such as construction, maintenance, operation, planning, or use. However, if the nuclear facility is in the United States, its territories and possessions, or in Canada, this exclusion applies only to property damage to that specific nuclear facility and its property.

B. Coverage B—Medical Payments excludes medical expenses for any individual or organization injured by the hazardous properties of nuclear materials. This exclusion applies when the injury occurs from the operation of a nuclear facility.

C. Glossary

The following definitions apply to the Nuclear Energy Exclusions:

1. Hazardous properties

This term includes substances with radioactive, toxic, or explosive properties.

2. Nuclear facility

This includes the site, operations, and premises of any of the following:

· A nuclear reactor

· Equipment or devices designed or used for any of the following:

o separating uranium or plutonium isotopes through a process of isolation

o spent fuel utilization or processing

o waste handling, processing, or packaging

· Equipment or devices used for alloying, fabricating, or processing special nuclear materials, if at any time the total amount of such materials in the custody of the insured at the location of the equipment or device, contains:

o more than 25 grams of plutonium, or

o more than 25 grams of uranium - 233, or

o any combination of the two above, or

o 250 grams of uranium - 235.

· Any structure or place prepared or used to store or dispose of waste

· The site location where any of the above are situated, including all operations and premises used for those activities.

3. Nuclear material

This refers to source material, special nuclear material, or by-product material.

4. Nuclear reactor

This is any device designed for or used to:

· maintain nuclear fission through a self-sustaining chain reaction.

· contain enough fissionable material to reach critical mass.

NOTE: It does not specify the reactor's size or the amount and kind of material needed.

5. Property damage

The term property damage is expanded to also cover all forms of radioactive contamination of property.

6. Source Material, Special Nuclear Material, and Byproduct Material

These terms are given their meaning by the Atomic Energy Act of 1954 and any amendments.

7. Spent fuel

This refers to any fuel element or component used in or exposed to radiation within a nuclear reactor. It can be either solid or liquid.

8. Waste

This refers to any waste material meeting the following criteria:

· Waste resulting from the operation of a nuclear facility as described in the first two items of the nuclear facility.

· Waste containing any by-product material

o This excludes tailings or waste from extracting or concentrating uranium or thorium from ore primarily processed for their original source material.

PART III – Physical Damage Exclusions

1. Government / Legal / War Exclusion

Ultimately, there is no coverage for any loss directly or indirectly related to war or warlike activities.

B. The following actions, known to any insured, are also excluded:

· Violation of an ordinance or penal law committed by an insured or with their consent

· Statutory fines or liability

· Punitive or exemplary damages

· Illegal trade illegal

C. Losses involving property considered contraband or involved in illegal transportation or trade are not covered. Additionally, losses, confiscations, or seizures resulting from laws or regulations related to the following are also excluded:

· Customs

· Drug enforcement

· Quarantine

2. Part III – Nuclear/Radioactive Loss Exclusion

A. Nuclear events, occurences, or operations are excluded. This includes explosions, reactions, radiation, or radioactive contamination.

Fire, explosion, smoke, and other causes of loss are not part of this exclusion.

B. Properties of nuclear or radioactive material, whether natural or manufactured, are excluded if they are injurious, such as:

· Explosive

· Radioactive

· Toxic

· Other

COMMON CONDITIONS – PARTS II AND III

The following Conditions apply to Parts II and III of the policy and are in addition to the Conditions specified in the separate coverage parts.

1. Action or Suit Against Us

Part II

It is important to understand that legal action may be taken against the insurance company, but it is limited by the following conditions:

A. All contractual obligations of the insured must be fulfilled.

B. The insured’s obligation under this policy has been determined by a court judgment or a written agreement approved by the insurance company.

The policy does not grant the named insured any right to bring the insurance company into legal action against any other insured.

Part III

It is important to understand that legal action may be taken against the insurance company, but it is limited by the following conditions:

· All contractual obligations of the insured must be fulfilled.

· The action is initiated within one year from the date of the loss.

The policy does not grant the named insured any right to bring the insurance company into legal action against any other insured.

2. Assignment of Your Interest

The named insured does not have the option to assign its interest in the policy to another without the insurance company's written consent.

The only exception occurs when the named insured is an individual.

If the insured is an individual and dies, all rights and responsibilities transfer to a legal representative. However, this transfer is limited to the period when the representative is acting in their official capacity or has custody of the named insured’s property. Outside of this role, the legal representative is not covered for any actions.

Example: John wants out. Tired of running his company, he accepts a lucrative cash offer from Jack. John transfers all ownership rights to Jack and leaves town. However, Jack encounters a problem: he has no insurance coverage because, although John can relinquish his ownership, he cannot transfer his insurance policies to Jack or anyone else. As a result, Jack must obtain his own insurance coverage.

3. Cancellation/Termination

This condition outlines how cancellations are handled. Although many states mandate the use of a specific state form instead of this cancellation condition, it serves as a starting point.

A. General

1. The first named insured is the only entity authorized to cancel the policy on behalf of the insured. To do so, they need to surrender the policy or mail a notice to the company agent or the insurance company, and include the cancellation date. The cancellation request will apply to all other insureds and any interests covered by the policy.

2. The first named insured receives a return premium if the policy is cancelled. If the insurance company cancels the policy, the return premium must be pro rata of the policy premium. However, if the first named insured requests the cancellation, the return premium may be less than the pro rata amount. Payment of the return premium is to be made within 30 days of the cancellation date.

NOTE: The short-rate penalty is not mandatory, but it is a possibility.

3. Automatic Terminations

· If the named insured chooses to purchase insurance from another company and does not pay the premium or installment on this policy when it is due, this policy will automatically end once that other insurance takes effect.

· If the named insured sells a covered auto, the policy coverage for that vehicle ends immediately once the title is transferred.

B. Our Right to Cancel or Terminate

The insurance company's rights to cancel or terminate the policy are found in the state mandatory endorsement.

4. Concealment / Misrepresentation / Fraud

A. Coverage is void in any case of fraud by the named insured at any time with respect to this insurance. It is also void if the named insured or any insured at any time intentionally conceals or misstates important facts related to this insurance. This includes information the insurance company relied on when issuing the policy.

B. If the insurance company does not void the policy entirely, it reserves the right to deny coverage to any insured who committed any voidable offense.

Related Court Case: Does Driver's Fraud Bar Coverage?

5. Conformity with Statute

The insurance company agrees that, in the event of a conflict between statutory requirements and the terms of this policy, statutory requirements will prevail.

6. Coverage Territory

Only accidents and losses occurring in the coverage territory are covered. The coverage territory includes the following:

· The United States of America and its territories and possessions

· Puerto Rico

· Canada

Coverage also applies if the covered auto is being transported between any of the coverage territories.

7. Examination / Premium Audit

A. The insurance company has the right to make inspections and/or conduct surveys. It then may also provide reports and recommendations to the named insured.

This right benefits only the insurance company. Inspections and surveys are not intended as safety checks for third parties or employees. They should not be viewed as warranties or guarantees that the named insured meets safety or health codes.

This condition applies to the insurance company that provides coverage and any rating advisory organization.

The insurance company has the right to review the named insured's books and records. However, this right applies only to books and records that relate to this coverage form or premium payment. This right extends throughout the policy term and for up to three years after. The first named insured is required to keep the books accurate and ready to be reviewed.

B. The initial premium paid is an estimated premium based on the exposures the named insured provided to the insurance company at inception. The insurance company calculates the final premium based on the actual exposures. This is usually completed after the end of the policy term.

After calculating the actual exposures, the estimated premium is deducted. The first named insured is then billed for any remaining balance or issued a refund if they overpaid. The billing statement will specify the due date for the additional premium.

8. Liberalization

Any broadened or additional coverage offered under a revised version of this coverage form by the insurance company, which is available at no additional charge, automatically applies to this policy. It takes effect on the date the coverage begins in the named insured’s state, even if that date is as much as 45 days prior to the policy's issuance.

9. Other Insurance

A. This insurance is primary if the named insured owns the covered auto; otherwise, it acts as excess over any other collectible insurance. Trailer coverage follows a similar principle.

B. Coverage A—Liability to Others – Special Condition

1. Liability coverage for a covered trailer attached to the named insured's covered auto is primary. However, if the trailer is attached to a motor vehicle the insured does not own, the coverage becomes excess.

2. This coverage is primary for liability included under the Contractual Supplemental Coverage.

C. If this insurance and any other insurance provide coverage on the same basis, whether as excess or primary, the insurer will only pay its proportional part of the loss or obligation. This proportion is determined by dividing its applicable limit of liability by the total insurance limits from all insurers providing coverage on the same basis.

NOTE: Ratios are determined based on each company’s limits, expressed as a percentage of the total available limits. Losses are proportioned among the companies accordingly.

D. Under Coverage B—Medical Payments, the sharing of limits discussed in paragraph C above applies only to collectible auto medical payments coverage.

10. Premiums

A. The first named insured is the party responsible for paying all premiums and receives all return premiums. This includes premium adjustments resulting from audits.

B. If the policy is issued for a period longer than one year, the premium will be recalculated annually at each anniversary date, using the rates and premiums effective at that time.

11. Recovery from Others

When the insurance company makes payments for any covered party under this policy, all rights that party has to seek recovery from others for the loss or damage caused by the responsible party automatically transfer to the insurance company up to the amount paid. That party must take all necessary steps requested by the insurance company to protect their recovery rights and avoid actions that could jeopardize those rights.

This requirement is not applicable to Coverage B – Medical Payments.

12. Time of Inception

The policy's start and end dates are determined by the address listed on the Declarations. The policy begins at 12:01 AM Standard Time on the start date and expires at 12:01 AM Standard Time on the end date.

13. Two or More Coverage Forms or Policies Issued by Us

Unless a policy or coverage is explicitly issued as an umbrella or excess liability, if this coverage form and any other coverage form or policy issued to the same insured by the insurance company or any of its affiliates cover the same accident, the total payment across all coverage limits combined will not exceed the highest limit of liability in any single coverage form or policy.

14. Waiver or Change of Provisions

The policy issued by the insurance company is an agreement with the named insured. If the first named insured requests a change, the insurance company can accept or reject it. Only the first named insured has the authority to make policy changes. Any endorsement that alters, waives, or modifies the policy must be attached to the policy.

All agreements between the named insured and the insurance company are contained in this policy.

COMMON GLOSSARY – PARTS II AND III

Some words and phrases in this policy are specifically defined for this insurance contract. They appear throughout the policy in italics. The following provides definitions for these terms.

Accident

When used in this policy, the term accident includes continuous or repeated exposure to the same condition that results in bodily injury or property damage.

NOTE: The term "accident" is not specifically defined in this context. Therefore, it will then typically follow the definition from a widely used dictionary, such as Merriam-Webster. Merriam-Webster describes "accident" as “an unforeseen and unplanned event or circumstance, a lack of intention or necessity, or an unfortunate event resulting especially from carelessness or ignorance.” This definition would then be expanded to include continuous and repeated exposure to the same condition causing the injury or damage.

Actual Cash Value (ACV)

The insurance company will consider any or all of the following factors when determining the actual cash value of property:

· condition	· deterioration	· obsolescence
· use	· utility	· economic value
· market value	· original cost
· cost to repair, replace, or restore – subject to appropriate depreciation	· any other circumstance that could impact the value, as long as it is reasonable.

NOTE: ACV is typically defined as Replacement Cost minus depreciation, but this definition expands the conditions under which ACV is considered.

Auto

Auto refers to any land motor vehicle, trailer, or semitrailer designed for use on public roads. It does not include mobile equipment but covers land vehicles subject to a state's financial responsibility or vehicle registration laws. Mobile equipment is defined later in this section. The applicable state law is based on where the vehicle is either licensed or principally garaged.

Bodily injury

The term bodily injury, as used in this policy, includes harm to the body, sickness, or disease a person sustains. Death resulting from bodily injury, sickness, or disease is also considered bodily injury.

Diminution in Value

This refers to the reduction in market value that occurs solely due to a loss, which can be either actual or perceived.

Related Court Case: Value of Automobile Disputed In Court

Employee

When the term employee is used in this policy, it refers to individuals employed directly by the named insured and to workers who are leased. However, it does not include temporary workers or independent contractors.

Family Member

To be considered a family member, the person must meet both of the following requirements:

A resident of the named insured’s household.
A person related to the named insured and/or their resident spouse through blood, marriage, adoption, or as a ward or foster child.

Fungi

This definition includes all fungi, such as molds, mildews, spores, algae, protists, rusts, and organisms that contribute to rot and decay. Organisms similar to or related to these are also considered fungi.

Toxins and any compounds, chemicals, substances, mist, or vapor produced by any of the items in the prior paragraph are considered fungi. The byproducts or waste of any of those fungi are also considered fungi.

The only exception to this definition is edible fungi. This indicates that mushrooms and related edible fungi are excluded from this definition.

Insured

Any party qualifying as an insured under “Who Is An Insured" is considered an insured.

Leased worker

A worker the named insured hires through a labor-leasing firm to work in the named insured's business. An agreement between the leasing firm and the named insured is required.

Temporary workers are not considered leased workers.

Loss

Only direct and accidental loss or damage qualifies as a loss. Property taken through theft is also considered a loss.

Mobile equipment

Mobile equipment is any of the following types of land vehicles, including any machinery or equipment attached to it:

A. Vehicles whose only purpose is to be used at the premises owned or rented by the named insured.

B. Vehicles designed primarily for use off public roads. Examples include bulldozers, farm machinery, forklifts, and similar commercial equipment.

C. Any vehicle used primarily to provide mobility to nonmix-in-transit concrete mixers, power cranes, shovels, loaders, diggers, drill or road construction, or resurfacing equipment, provided it is permanently attached to or forms an integral part of the vehicle.

D. Similar to what is described in C., but not included in A., B., or C., these vehicles are used to transport equipment such as air compressors, pumps, generators, and tools for spraying, welding, building cleaning, geophysical exploration, lighting, and well servicing. They also carry devices used to lift or lower workers. These items must be permanently mounted on the vehicle and cannot be self-propelled.

E. Any vehicle that travels on crawler treads.

F. Vehicles maintained primarily by the insured, not used to transport people or cargo, and not described in paragraphs A., B., C., D., or E. above.

However, there are exceptions. Any self-propelled vehicle with the following equipment permanently attached is considered an auto and not mobile equipment:

· Vehicles designed primarily for road maintenance, such as snow removal or street cleaning, but excludes any road construction or resurfacing.

· Vehicles with air compressors, pumps, and generators, including spraying, welding, building cleaning, geophysical exploration, lighting, or well servicing equipment.

· Devices like cherry pickers and similar equipment used to lift workers, provided they are mounted on an automobile or truck chassis.

Land vehicles governed by a state's financial responsibility or vehicle registration laws are classified as autos, not mobile equipment.

NOTE: Recognizing the difference between autos and mobile equipment can be challenging. This issue is the focus of the following court case.

Occupying

NOTE: This is a crucial term and should be taken very seriously because many coverage disputes have centered on whether the person was occupying a covered auto at the time of the accident.

All the following are considered occupying:

· getting in	· getting out of	· getting off
· in	· on	· upon

Pollutants

Pollutants are irritants and contaminants that can appear as solids, liquids, gases, or thermal substances. Examples include smoke, vapor, soot, fumes, acids, alkalis, or chemicals. Waste is also considered a pollutant, including items intended for disposal, recycling, reconditioning, or reclamation.

Private Passenger Type

If the named insured is an individual, private passenger type vehicles also include any covered auto owned by the named insured that is a pickup or van-type truck and not used for business, unless it is for farming or ranching.

Property damage

Direct physical harm to tangible property, including the loss of use. The loss of use is considered to occur at the moment of the physical injury. For tangible property not physically damaged, any loss of use is also understood to happen at the time of the relevant accident.

Rot and Decay Organisms

This term refers to a living organism and is used in the definition of fungi. It causes the decomposition of physical material.

Temporary worker

A temporary worker is someone furnished to the named insured to replace a permanent employee or assist in a short-term situation, like work. Leased workers, however, are not classified as temporary workers.

NOTE: This definition is important because temporary workers are not classified as employees. In addition, exclusions applicable to employees do not apply to temporary workers. As well, temporary workers are not considered insureds.

Trailer

The term "trailer" includes semitrailers.

We / Us / Our

This refers to the Insurance Company providing the coverage and named in the policy.

You / Your / Yourself

These terms refer to the insureds shown on the Declarations. There could be multiple named insureds listed. If this is the case, the first insured shown is known as the first named insured and has additional duties and rights.

These terms also include the named insured’s spouse, but only if that spouse resides with the named insured.

NOTE: The definition specifies only “insured’s spouse.” However, in context, it is clear that only the spouse of a named insured qualifies as a named insured.

Your Work

There are several parts to this definition.

· The work or operations carried out by or for the named insured.

· Furnished equipment, parts, or materials used in connection with the work or operations described in A. above.

· Warranties or representations, regardless of when they are made, related to the work, operations, or the equipment, parts, or materials provided for this work, covering the following:

o Durability

o Fitness

o Performance

o Quality

o Use

· Instructions or warnings regarding the work or operations or the equipment, parts, or materials involved in the insured’s work, whether provided or should have been provided.