Ask PIA

Resident family member

My clients insure a vehicle, used by their son at college, on a personal auto policy. The parents are planning to leave the country for two years. They have made arrangements to have the policy billed at the grandparent’s address.

Is it alright to leave the parents as the named insureds on this policy?

Damage to vehicle from shifting load

My insured was driving his pickup when he was forced to stop quickly. Equipment in the bed of the truck shifted forward, damaging the cab. Under a business auto policy, would this damage be covered under comprehensive or collision coverage?

Joint ownership coverage endorsement

Could you clarify what the Joint Ownership Coverage (PP 03 34) endorsement to the ISO Personal Auto Policy is designed to do?

Betterment clause

In an auto physical damage claim, the insurer wants to use nonoriginal equipment manufacturer parts and the claimant does not want them. So, the company states that if the client insists on the original equipment manufacturer parts, it will invoke the policy’s “betterment” clause. Can they do this?

Coverage not terminated by plate surrender

Our insured’s vehicle was hit while parked. We reported the loss to the negligent party’s carrier to collect on a third-party basis. The company confirmed that coverage was in place.

Then, three weeks later, the company told us their insured had surrendered his plates the day before the accident. (He had borrowed somebody’s plates and put them on the vehicle to move it from one place to another.) It looks like the carrier may try to deny the claim based on the surrender of the plates. Would they be able to do this?

BAP Symbol 7 newly acquired auto coverage

Our insured has an automobile policy written with Symbol 7 for comprehensive coverage in the ISO Business Auto Coverage Form. If a comprehensive loss occurs to a newly acquired auto within 30 days after acquisition, but before the insured notifies us that the auto has been acquired, would this loss be covered?

Disability offset

We have an insured who is disabled due to an automobile accident. He had selected Additional Personal Injury Protection—Option 5. He is collecting disability pay from a combination of statutory disability coverage ($324 per week) and private disability coverage ($100 a week), for a total of $425 a week. However, the salary lost due to disability is $700 a week. The auto insurer is refusing to pay any income continuation benefits, claiming that the disability coverage payments fully offset their liability to pay. Is this right?

Uninsured motorists property damage coverage deductible

We have a client who has a $2,000 deductible on collision coverage and the mandatory $500 deductible on uninsured motorists property damage. She was rear-ended by an uninsured vehicle. The driver has no assets. Can she recover the $1,500 difference between the deductibles?

After-market parts

What are the rules governing the use of after-market parts in New Jersey?

Agricultural license

We have an insured whose 16-year-old son is taking a road test for a special farm license he says allows him to exclusively drive from home to the farm where he works and back. What type of operator’s license is he referencing?

Take all comers fraudulent applications

We have a client whose auto insurance has been canceled by the insurer because the insured provided false information about her use of the insured vehicle.

Under the New Jersey take-all-comers law, what is our responsibility to replace this client’s coverage?

Coverage for bike-car accident

While my insured was out riding his bike, he hit and damaged a car. Which policy pays: his automobile or his homeowners?

Rental for business use

My insured is renting a van for a business trip. Does he have liability and physical damage coverage under his personal auto policy?

Renters with no auto policy

I recently read about a Florida law (Section 627.7263), that allows the rental company to make a renter’s personal auto policy primary with respect to liability coverage for accidents involving vehicles rented in Florida.

What about the renter who does not have a personal auto policy? Many people who live in the New York metro area do not own cars. Also, there are others who normally drive corporate vehicles furnished for their regular use and thus have no personal auto policy.

Do such renters need a named nonowner policy (or drive-other-car coverage under the business auto policy) in order to have coverage if they rent cars in Florida?

Title with salvage brand

My client’s auto was totaled in an accident. The insurer is discounting the value of the auto because its title has been “salvage branded.” Is the insurer permitted to do this?

Extended rental period

My client has two cars insured on a personal automobile policy. His son is away at college, so the two vehicles have been adequate for him and his wife. His son is coming home for the summer, and my client wants to rent a third car for two-and-a-half months. He would drive the rental car, and his son would drive one of their own vehicles. Will he have coverage for the rental car under the personal auto policy?

Nonowned auto coverage—employee’s auto

Is there an exclusion on a commercial auto policy for the business owner/employee who uses his own vehicle to travel between offices, or uses his vehicle for other office errands, and then has an accident that causes a liability suit naming the business entity?

Falling object

As a car is driving down the highway behind a truck, something flies off the truck. The car can’t avoid the object and runs over it, causing a puncture in the gas tank. Is this comprehensive (falling object) or collision? Also, does this constitute a chargeable accident?

Lawful auto rate discrimination

How can auto insurance companies discriminate and charge different rates for credit, age, gender, etc.? Is that really legal?

Travel trailers

I have two insureds that have pickup trucks insured under a business auto policy in their business name. They also use these trucks to pull their fifth-wheel travel trailers. We have been advised by the business auto carrier that they cannot provide liability coverage for these travel trailers and the companies that insure the physical damage coverage for the travel trailers are unable to add liability to their policy. Any suggestions?

Rental for business use

My insured is renting a van for a business trip. Does he have liability and physical damage coverage under his personal auto policy?

Zipcars and employees

My client’s law firm directs its employees to use Zipcars when attending meetings. How is this covered on the commercial automobile policy?

Bait-and-switch activities

I lost a client to a direct writer who offered them a lower rate on their auto policy then I could. However, shortly after the policy was bound, the client called me up complaining that the direct writer increased the premium. The direct writer did not run the motor vehicle report on the client until after the policy was bound. They discussed an accident that had not been disclosed by the client. Can the direct writer actual do this?

Transgender operators

How does a producer address transgender operators when placing auto insurance?

Physical damage coverage for valet parking

I saw Ask PIA 900241—Coverage for valet parking on your website, which discussed only liability coverage for a rented vehicle. What about physical damage coverage in that scenario? Unless you have a New York policy, I personally would not valet park a rental car when physical damage is involved. Coverage is too uncertain.