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INSURING GARAGE

RISKS

SANDI KRUISE INSURANCE TRAINING 1-800-517-7500 www.kruise.com

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GARAGE COVERAGE FORM ..................................................................................... 4

Auto Dealers ............................................................................................................... 4

Non-dealers ................................................................................................................. 5

Both Dealers and Non-dealers .................................................................................... 5

COMPONENTS OF THE ISO GARAGE POLICY FOR DEALERS .......................... 6

POLICY INTRODUCTION AND COVERED AUTOS (SECTION I) ........................ 7

Garage Coverage Form ................................................................................................... 7

SECTION I—Covered Autos ......................................................................................... 9

COVERED AUTOS—DEALERS POLICY .............................................................. 9

SYMBOLS .............................................................................................................. 9

COVERED AUTOS—NONDEALERS POLICY ................................................... 10

SYMBOLS ............................................................................................................ 10

Symbol 21—Any Auto ................................................................................................. 11

Symbols 22, 23, and 24—Owned Autos, Owned Private Passenger Autos, and Owned

Autos Other Than Private Passenger ............................................................................ 12

Symbol 25—Owned Autos Subject to No-Fault .......................................................... 12

Symbol 26—Owned Autos Subject to Compulsory UM .............................................. 13

Symbol 27—Specifically Described Autos .................................................................. 13

Symbol 28—Hired Autos ............................................................................................. 14

Symbol 29—Non-owned Autos Used in Named Insured's Garage Business ............... 14

Symbol 30—Autos Left for Service, Repair, Storage, or Safekeeping ........................ 15

Symbol 31—Autos Held for Sale ................................................................................. 15

Newly Acquired Autos ................................................................................................. 17

Trailers, Mobile Equipment, and Temporary Substitute Autos .................................... 17

LIABILITY COVERAGE (SECTION II) .................................................................... 19

Insuring Agreement ...................................................................................................... 19

Garage Operations—Other Than Covered Autos ......................................................... 19

Garage Operations—Covered Autos ............................................................................ 20

Who Is an Insured—Covered Autos ............................................................................. 21

Who Is an Insured—Other Than Covered Autos .......................................................... 23

Supplementary Payments .............................................................................................. 24

Out-of-State Coverage Extensions ................................................................................ 25

Liability Exclusions ...................................................................................................... 26

Expected or Intended Injury Exclusions ....................................................................... 26

Contractual Exclusion ................................................................................................... 26

Workers Compensation Exclusion ................................................................................ 27

Employee Indemnification and Employer's Liability Exclusion .................................. 27

Fellow Employee Exclusion ......................................................................................... 29

Care, Custody, or Control Exclusion ............................................................................ 29

Leased Autos Exclusion ................................................................................................ 30

Pollution Exclusion Applicable to Garage Operations—Other Than Covered Autos .. 31

Pollution Exclusion Applicable to Garage Operations—Covered Autos ..................... 33

Racing Exclusion .......................................................................................................... 35

Watercraft or Aircraft Exclusion .................................................................................. 35


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Defective Products Exclusion ....................................................................................... 36

Work Performed Exclusion........................................................................................... 36

Loss of Use Exclusion .................................................................................................. 37

Products Recall Exclusion ............................................................................................ 37

War Exclusion ............................................................................................................... 38

Liquor Liability Exclusion ............................................................................................ 38

Limit of Insurance ......................................................................................................... 40

Work Performed Deductible ......................................................................................... 42

GARAGEKEEPERS COVERAGE (SECTION III) .................................................... 43

Garagekeepers Insuring Agreement .......................................................................... 43

Who Is an Insured ..................................................................................................... 45

Supplementary Payments .......................................................................................... 46

Garagekeepers Exclusions ........................................................................................ 46

Contractual Exclusion ........................................................................................... 47

Theft or Conversion Exclusion ............................................................................. 47

Defective Parts and Faulty Work Exclusions ....................................................... 47

Electronic and Sound Receiving Equipment Exclusion ....................................... 48

Limit of Insurance and Deductible ........................................................................... 48

PHYSICAL DAMAGE COVERAGE (SECTION IV) ................................................ 50

Insuring Agreement .................................................................................................. 50

Comprehensive Coverage ......................................................................................... 50

Specified Causes of Loss Coverage .......................................................................... 51

Collision Coverage.................................................................................................... 51

Towing Coverage—Nondealers................................................................................ 52

Glass Breakage.......................................................................................................... 52

Temporary Transportation Expense .............................................................................. 53

Exclusions ................................................................................................................. 53

Leased or Rented Auto Exclusion......................................................................... 54

Racing Exclusion .................................................................................................. 54

False Pretense Exclusion....................................................................................... 56

Dealer Exclusions ................................................................................................. 57

Wear and Tear Exclusion ...................................................................................... 58

Limits of Insurance ................................................................................................... 58

Deductible ................................................................................................................. 60

Non-Dealers Only Special Deductible Provisions .................................................... 61

GARAGE CONDITIONS (SECTION V) .................................................................... 62

Loss Conditions ........................................................................................................ 62

Appraisal for Physical Damage Loss .................................................................... 62

Duties in the Event of Accident, Claim, Suit, or Loss .......................................... 63

Legal Action Against Insurer .................................................................................... 64

Loss Payment Options—Physical Damage .............................................................. 65

Transfer of Rights of Recovery................................................................................. 65

Bankruptcy ................................................................................................................ 66

Concealment, Misrepresentation, or Fraud ............................................................... 66

Liberalization ............................................................................................................ 67


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No Benefit to Bailee—Physical Damage Coverages ................................................ 67

Other Insurance ......................................................................................................... 67

Premium Audit .......................................................................................................... 70

Policy Period, Coverage Territory ............................................................................ 70

Two or More Coverage Forms or Policies Issued by Insurer ................................... 72

DEFINITIONS (SECTION VI) .................................................................................... 73

"Accident" ................................................................................................................. 73

"Auto" ....................................................................................................................... 73

"Bodily Injury" .......................................................................................................... 73

"Covered Pollution Cost or Expense" ....................................................................... 74

"Employee" ............................................................................................................... 75

"Garage Operations" ................................................................................................. 76

"Insured" ................................................................................................................... 77

"Insured Contract" .................................................................................................... 77

"Leased Worker" ....................................................................................................... 79

"Loss" ........................................................................................................................ 80

"Pollutants" ............................................................................................................... 80

"Products" ................................................................................................................. 80

"Property Damage" ................................................................................................... 81

"Suit" ......................................................................................................................... 81

"Temporary Worker" ................................................................................................ 81

"Trailer" .................................................................................................................... 82

"Work You Performed" ............................................................................................ 82

CLOSING COMMON GARAGE INSURANCE COVERAGE GAPS ...................... 83

Dealer Exclusions ......................................................................................................... 83

COLLISION RADIUS LIMITATION ............................................................. 83

DRIVEAWAY COLLISION COVERAGE ..................................................... 84

Damage to Products ...................................................................................................... 84

DEFECTIVE PRODUCT EXCLUSION ......................................................... 84

BROAD FORM PRODUCTS COVERAGE ENDORSEMENT ..................... 85

False Pretense................................................................................................................ 85

FALSE PRETENSE COVERAGE ENDORSEMENT .................................... 85

Broadened Coverage—Garages .................................................................................... 85

ADDITIONAL COVERAGES PROVIDED BY ENDORSEMENT CA 25 14

........................................................................................................................... 86

All Risk Legal Liability Coverage ................................................................................ 86

Customer Coverage ....................................................................................................... 86

ELIMINATION OF CUSTOMER COVERAGE ............................................ 86

Drive Other Car Coverage ............................................................................................ 88

DRIVE OTHER CAR COVERAGE EXCERPTS ........................................... 88

Conclusion ................................................................................................................ 89


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GARAGE COVERAGE FORM The garage policy is a specialized form designed to provide insurance to commercial entities that are in a business related to autos, such as selling, servicing, or repairing autos. The exposures and insurance needs of such businesses are distinctive in that auto liability and general liability coverage needs tend to overlap. The garage policy combines, in one form, coverage for liability exposures arising from the entity's premises, operations, products, completed operations, independent contractors, contracts, along with ownership, maintenance, or use of autos. There are two types of garage policies written, depending on whether the insured is a franchised or nonfranchised auto dealer (referred to in the garage policy as a dealer or as an auto dealership), or an auto service operation or a trailer dealer (referred to as a nondealer or as "something other than an auto dealership").

Auto Dealers

Auto dealers sell, service, and repair new or used private passenger autos, trucks, truck-tractors, motorcycles, recreational vehicles, and other self-propelled land motor vehicles. Franchised dealers typically sell new models produced by one or a limited number of manufacturers, and usually offer a full range of services to their customers. They also act as the manufacturer's contact point in a given locale for authorized services or repairs, including any that might be necessitated by a product recall. Franchised dealers may also sell used vehicles taken as trade-ins in connection with their new car sales. Nonfranchised dealers, on the other hand, do not have a specific arrangement with a manufacturer and generally sell used autos. It is unusual for them to offer anything but routine services in connection with their vehicle sales. In some states equipment and implement dealers may be covered as auto dealers under a garage policy. In most states, however, these types of businesses are not eligible. For both franchised and nonfranchised dealers, the premium charge for the liability portion of the garage policy is based on number of rating units, (the number of Class I employees and Class II non-employees). The term Class I employee includes proprietors, partners, and officers active in the business; salespersons, general managers, and service managers; and employees including part-time employees. Class I employees who are neither furnished a garage auto nor whose principal duties involve the operation of autos are counted as 40 percent of a rating unit; employees working less than 20 hours a week are discounted by one-half before determining number of rating units; each employee counts as one rating unit. The term Class II nonemployee includes any individual other than a person described in Class I who is regularly furnished with a dealer's auto. This could include inactive proprietors, partners, or officers, and relatives of either Class I employees or other Class II nonemployees who are regularly furnished with a covered auto. Class II nonemployees under the age of 25 are counted as 1.15 rating units, while those 25 or over are counted as one-half a rating unit. The premium charge, determined by multiplying rates by the number of rating units, encompasses both the exposure arising out of premises and operations and the use of autos. There is no separate premium charge for autos except those furnished for regular use to entities that are neither Class I employees nor Class II nonemployees.


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The CLM lists six classes of business for which the dealer’s version of the garage coverage form is appropriate. The six classes for which a dealer’s policy is universally applicable are the following.

Franchised private passenger auto dealers

Franchised truck or truck-tractor dealers

Franchised motorcycle dealers, including any two-wheeled cycle vehicles

Franchised recreational vehicle (RV) dealers

Other franchised self-propelled land motor vehicle dealers

Nonfranchised dealers of any of the foregoing types of vehicles In a few states a seventh class—equipment and implement dealers—may still be covered as a dealer under a garage policy.

Non-dealers

Non-dealers typically involve service and repair operations, such as repair shops, service stations, public parking facilities, and tow truck operators, as well as both franchised and nonfranchised trailer dealers. Liability premium rating for nondealers is very different from that of dealers. Premium for the premises-operations and nonowned autos exposure is based on payroll; a separate charge is determined for hired autos based on cost of hire and for owned autos based on weight, business use, and radius of operations.

Both Dealers and Non-dealers

The insured may purchase coverage under the garage policy for loss related to physical damage to its own vehicles and also to vehicles in its possession on consignment for sale. The insured may also purchase garagekeepers coverage for loss to vehicles left in its care. Garagekeepers coverage may be limited so that it applies only when the insured is legally liable, or it may apply in a broader manner. Coverage may be provided either on a monoline or a package basis. In either case, the components for providing coverage under the ISO program consist of the common policy conditions (IL 00 17), nuclear energy liability exclusion endorsement (IL 00 21), garage coverage form (CA 00 05), and garage declarations (CA 00 06). Used when the policy is written on a monoline basis, or CA 00 09 when the garage policy is included in a package format. In addition to the forms listed above, ISO has developed supplementary schedules to record exposures and rating information for businesses insured under a garage coverage form. The garage coverage form—auto dealers' supplementary schedule (CA DS 07) is appropriate for the dealers’ version while the garage coverage form—nondealers' and trailer dealers' supplementary schedule (CA DS 08) is appropriate for non-dealers such as auto service operations.


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COMPONENTS OF THE ISO GARAGE POLICY FOR DEALERS The following forms are used to structure a garage policy for a dealer when it is part of a package policy. IL 00 17 Common Policy Conditions IL 00 19 Common Policy Declarations IL 00 21 Nuclear Energy Liability Exclusion Endorsement CA 00 05 Garage Coverage Form CA 00 06 Garage Coverage Form Declarations CA 00 07 Garage Coverage Form—Auto Dealers’ Supplementary Schedule The following forms are used to structure a monoline garage policy for a dealer. IL 00 17 Common Policy Conditions IL 00 21 Nuclear Energy Liability Exclusion Endorsement CA 00 05 Garage Coverage Form CA 00 09 Garage Declarations CA 00 07 Garage Coverage Form—Auto Dealers’ Supplementary Schedule Nondealer garage insureds may also purchase insurance under a garage coverage form. However, the rating mechanism for nondealer insureds differs from that of dealers. For non-dealers the rating is separate for general liability exposures and auto liability exposures, while for dealers the rating is combined. The six classes of business that qualify for the ISO CLM category of nondealer insureds include the following.

Repair shops—primarily engaged in the repair of autos, including body, fender, radiator, ignition service, and paint shops (including incidental self-service operations)

Service stations—primarily engaged in the servicing of autos and the sale and installation of auto accessories (including car washes and incidental self-service operations, but not include major engine or body repair work)

Storage garages and public parking places—primarily engaged in storing or parking autos

Franchised and nonfranchised residence-type mobile home trailer dealers

Franchised and nonfranchised commercial trailer dealers

Tow truck operators—exclusively engaged in operating tow trucks and not incidental to any other classification described above

The garage coverage form (CA 00 05) is specifically structured to address the needs of auto dealers and automobile service operations. Each of the garage coverage form sections (Covered Autos, Liability Coverage, Garagekeepers Coverage, Physical Damage Coverage, Garage Conditions, and


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Definitions) is analyzed separately in the following sections of this course. The actual policy wording of the July 1997 garage coverage form is shown inside a box, followed by a discussion of each provision.

POLICY INTRODUCTION AND COVERED AUTOS (SECTION I) The scope of coverage in the garage policy is set out by symbols in the declarations that describe the autos or type of autos to which a particular coverage applies. It is extremely important to use correct symbols to activate coverages as intended. The symbols used with the garage policy are similar to, but different from those used with the business auto policy (BAP). If a symbol is shown next to "Liability" in the declarations, the policy extends to cover the insured's exposure to liability resulting from garage operations as well as liability resulting from the ownership, operation, or use of covered autos. Even if the insured only purchases auto liability coverage for one specifically described auto, the policy also covers the insured's exposure to liability for loss resulting from its garage operations. If the insured purchases liability insurance to cover its exposure to liability arising out of the ownership, maintenance, or use of any automobile, symbol 21 (any auto) would be indicated in the policy declarations. If, on the other hand, the insured purchases liability insurance to cover its exposure to liability arising out of its ownership, maintenance, or use of only specifically described autos, the symbol 27 (specifically described autos) would be indicated. In either case, the garage liability policy would apply to the insured's exposure to loss arising out of its garage premises and all operations necessary or incidental to its "garage operations," as defined in the policy. Since, many of the garage coverage options are effected by an indication in the garage declarations, the declarations page is of ultimate importance. To effect coverage, the appropriate symbols must be shown and applicable premium indicated. The policy provides only those coverages where a charge is shown in the premium column and applies only to those autos shown as covered autos. The declarations schedule also contains space for limits that determine how much the insurer will pay for any one accident or loss, as well as the most the insurer will pay in the aggregate in the case of liability arising out of garage operations (other than for ownership, maintenance, or use of covered autos).

Garage Coverage Form

Various provisions in this policy restrict coverage. Read the entire policy carefully to determine rights, duties and what is and is not covered. Throughout this policy the words "you" and "your" refer to the Named Insured shown in the Declarations. The words "we" "us" and "our" refer to the Company providing this insurance. Other words and phrases that appear in quotation marks have special meaning. Refer to Section VI —Definitions.


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Copyright, Insurance Services Office, Inc., 1996

This introductory section is designed to set the stage for the "easy-to-read" policy wording and to encourage the insured and the courts to read and consider the entire policy in order to settle coverage questions whenever they arise. The second paragraph of this section defines the two parties to the contract (the insurer and the named insured). While the majority of definitions pertaining to the garage coverage form are found in Section VI of the form, the words referring to the named insured and the insurer are defined here. It is important to list all named insureds in the policy declarations or by endorsement to assure the broadest coverage available for the entities and individuals who qualify as named insureds. The third paragraph refers to the section of the form where other applicable definitions are located.


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SECTION I—Covered Autos Section I of the garage coverage form sets out the symbols that may be used in the declarations to indicate autos that are "covered autos" under the policy. These symbols are extremely important in determining how the policy applies, so it is imperative that both agents and insureds understand them.

COVERED AUTOS—DEALERS POLICY

The following list displays the garage symbols for covered autos that may be used to signify the various coverages available in the garage policy when the insured is a dealer. SYMBOLS

21 Any Auto 22, 23, or 24 Owned Autos 25 Owned Autos Subject to No-Fault 26 Owned Autos Subject to Compulsory UM 27 Specifically Described Autos 28 Hired Autos 29 Nonowned Autos 30 Autos Left for Service 31 Dealers’ Autos

Coverages 21 22-24 25 26 27 28 29 30 31 Liability Yes No No No No No No No No Personal Injury No No Yes No Yes1 No No No No Protection Medical Payments Yes No No No No No No No No Uninsured Motorists No Yes2 No Yes Yes1 No No No No Underinsured No Yes2 No Yes Yes1 No No No No Motorists Garagekeepers No No No No No No No Yes No Physical Damage Other Physical No Yes No No Yes1 Yes1 No No Yes3 Damage __________ 1 Although symbols 27 and 28 theoretically may be used to activate coverage as shown for an insured who is dealer, as a practical matter the symbols are not usually used for dealers. 2 When fleet automatic UM/UIM coverage is desired in those states in which such coverage may be rejected, either the owned auto symbol 22 (owned autos) or 23 (owned private passenger autos) may be used. Symbol 23 (owned autos other than private passenger) would usually not be used.


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3 When symbol 31 is used for dealers, symbols 22 (owned autos), 23 (owned private passenger autos), and 24 (owned autos other than private passenger) are not needed since the dealers’ autos designation would include autos owned by the dealer.

COVERED AUTOS—NONDEALERS POLICY

The following list displays the garage symbols for covered autos that may be used to signify the various coverages available in the garage policy when the insured is not a dealer. SYMBOLS 21 Any Auto 22, 23, or 24 Owned Autos 25 Owned Autos Subject to No-Fault 26 Owned Autos Subject to Compulsory UM 27 Specifically Described Autos 28 Hired Autos 29 Nonowned Autos 30 Autos Left for Service 31 Autos Held for Sale Coverages 21 22-24 25 26 27 28 29 30 31 Liability Yes1 Yes2 No No Yes2 Yes2 Yes2 No No Personal Injury No No Yes No Yes No No No No Protection Medical Payments Yes1 Yes2 No No Yes2 No Yes2 No No Uninsured Motorists No Yes No Yes Yes No No No No Underinsured No Yes No Yes Yes No No No No Motorists Garagekeepers No No No No No No No Yes No Physical Damage Other Physical No Yes No No Yes Yes No No Yes Damage __________ 1 Symbol 21 may, but in most cases will not, be used for nondealer garage insureds for liability and medical payments coverage. 2 Symbols 22, 23, 24, 27, 28, and 29 are not needed for liability and medical payments coverage in the event symbol 21 is used.


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Item Two of the Declarations shows the "autos" that are covered "autos" for each of your coverages. The following numerical symbols describe the "autos" that may be covered "autos". The symbols entered next to a coverage on the Declarations designate the only "autos" that are covered "autos". Copyright, Insurance Services Office, Inc., 1996

This paragraph shows how the section coordinates with the schedule of covered autos on the declarations. This section describes all the symbols that may be used to denote coverage, while the declarations schedule displays which symbols actually apply. Eleven symbols are listed in this section of the policy, some of which are only used to denote one particular type of coverage. Endorsement CA 99 54 may be used to describe a unique symbol (between 31 and 40) to fit a particular need.

Symbol 21—Any Auto

A. Description of Covered Auto Designation Symbols Symbol Description Of Covered Auto Designation Symbols 21 Any “Auto” Copyright, Insurance Services Office, Inc., 1996

Symbol 21 (any auto) is used to denote that any auto is a covered auto for purposes of this policy. The symbol, intended for use only with liability or medical payments coverage, provides coverage to the insured for bodily injury or property damage resulting from garage operations, including liability relating to the ownership, maintenance, or use of covered autos and any other liability resulting from garage operations (premises-operations and products-completed operations liability). When symbol 21 is used for medical payments coverage, both the auto medical payments coverage endorsement (CA 99 03), and the garage locations and operations medical payments coverage endorsement (CA 25 05), should be attached to the policy. Symbol 21 (any auto) affords the broadest liability and medical payments coverage available under the garage policy. When this symbol applies, no other symbols apply to the policy's liability or medical payments coverage. Insurers may be reluctant to allow the use of symbol 21 for nondealer garage insureds because of its breadth and the need to monitor actual exposures so as to collect the correct premium. Symbol 21 may be used to activate: liability and medical payments coverage. The symbol must always be used to provide liability coverage for auto dealers.


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Symbols 22, 23, and 24—Owned Autos, Owned Private Passenger Autos, and Owned Autos Other Than Private

Passenger

22 Owned “Autos” Only Only those “autos” you own (and for Liability Coverage any “trailers” you don’t own while attached to power units you own). This includes those “autos” you acquire ownership of after the policy begins. 23 Owned Private Passenger “Autos” Only Only the private passenger “autos” you own. This includes those private passenger “autos” you acquire ownership of after the policy begins. 24 Owned “Autos” Other Than Private Passenger “Autos” Only Only those “autos” you own that are not of the private passenger type (and for Liability Coverage any “trailers” you don’t own while attached to power units you own). This includes those “autos” not of the private passenger type you acquire ownership of after the policy begins. Copyright, Insurance Services Office, Inc., 1996

Symbols 22, 23, and 24 refer to autos the named insured owns. When any one of these symbols is used alone, the coverage does not extend to hired, borrowed, or nonowned autos (except liability for substitute automobiles and for trailers attached to the named insured's own power units). Coverage does apply for newly acquired vehicles. Symbols 22, 23, or 24 may be used to activate: liability and medical payments coverage (for nondealers only) and physical damage and uninsured/underinsured motorist’s coverage for both dealers and nondealers.

Symbol 25—Owned Autos Subject to No-Fault

25 Owned “Autos” Subject To No-Fault Only those “autos” you own that are required to have No-Fault benefits in the state where they are licensed or principally garaged. This includes those “autos” you acquire ownership of after the policy begins provided they are required to have No-Fault benefits in the state where they are licensed or principally garaged. Copyright, Insurance Services Office, Inc., 1996

Symbol 25 (owned autos subject to no-fault), is reserved for no-fault, or personal injury protection (PIP) coverage. The symbol affords automatic coverage for all owned vehicles that are required to have no-fault benefits in the states where they are licensed or principally garaged. Symbol 25 (owned autos subject to no-fault) and symbol 27 (specifically described autos) are the only two symbols that may be used to designate


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PIP coverage. Symbol 25 (owned autos subject to no-fault) is used when no-fault coverage is to be afforded automatically for all eligible vehicles. Symbol 27 (specifically described autos), on the other hand, requires the insured to notify the insurer of newly acquired vehicles within 30 days to affect the coverage. To assure that the required coverage is available and that the insured is in compliance with no-fault statutes, symbol 25 is the preferred choice for no-fault coverages. Symbol 25 is appropriate in any state with a no-fault law.

Symbol 26—Owned Autos Subject to Compulsory UM

26 Owned “Autos” Subject To A Compulsory Uninsured Motorists Law Only those “autos” you own that because of the law in the state where they are licensed or principally garaged are required to have and cannot reject Uninsured Motorists Coverage. This includes those “autos” you acquire ownership of after the policy begins provided they are subject to the same state uninsured motorist’s requirement. Copyright, Insurance Services Office, Inc., 1996

Symbol 26 (owned autos subject to a compulsory UM law), is reserved for use in states in which UM coverage is required by law and cannot be rejected. This symbol affords automatic coverage only in those compulsory UM states. To obtain automatic coverage in all states, either symbol 22 (owned autos) or symbol 23 (owned private passenger autos) may be used. If the insured wants to buy UM/UIM only on certain specified vehicles, and the state law allows such an approach, symbol 27 (specifically described autos) may be used.

Symbol 27—Specifically Described Autos

27 Specifically Described “Autos”. Only those “autos” described in Item Seven of the Non-Dealers’ and Trailer Dealers’ Supplementary Schedule or Item Nine of the Dealers’ Supplementary Schedule for which a premium charge is shown (and for Liability Coverage any “trailers” you don’t own while attached to a power unit described in Item Seven or Item Nine). Copyright, Insurance Services Office, Inc., 1996

Symbol 27 (specifically described autos) is used to signify that the policy coverage applies only to specifically described autos. This symbol may be used for nondealers to activate any of the coverages except garagekeepers or for dealers to activate coverages other than liability, medical payments, and garagekeepers. When used to activate liability coverage, it includes liability coverage for nonowned trailers attached to a described power unit. The symbol also provides a limited amount of protection for newly acquired vehicles, if the insurer already covers all owned autos for a particular coverage


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or the newly acquired vehicle replaces a previously owned vehicle which had that coverage and the insured informs the insurer within 30 days of acquisition that the coverage is desired. When this symbol is used, it is up to the insured to make sure all vehicles are reported to the insurer for coverage to apply. Symbol 27 may be used to activate: liability, physical damage, medical payments, personal injury protection, and uninsured/underinsured motorists’ coverage. Symbol 27 may be used for both dealers and non-dealers, but it will most often be used for nondealers to limit physical damage coverage to specified autos. For dealers, it might be used to provide physical damage coverage on a specified furnished auto.

Symbol 28—Hired Autos

28 Hired “Autos” only. Only those “autos” you lease, hire, rent or borrow. This does not include any “auto” you lease, hire, rent, or borrow from any of your “employees”, partners, (if you are a partnership), members (if you are a limited liability company) or members of their households. Copyright, Insurance Services Office, Inc., 1996

Symbol 28 (hired autos) may be used to designate coverage for leased, hired, rented, or borrowed autos only. Autos that are owned by employees, partners, members of limited liability companies, or members of the households of any of these are specifically excluded in this designation of covered autos. Symbol 28 (hired autos) may be used for physical damage coverage, either alone or in conjunction with symbols 22 (owned autos), 23 (owned private passenger autos), 24 (owned autos other than private passenger), or 27 (specifically described autos). It may not be used for no-fault or uninsured motorist’s coverage, nor for medical payments coverage. Its use for liability coverage is limited to nondealer insureds. Symbol 28 may be used to activate liability coverage for non-dealers and physical damage coverage for dealers or non-dealers. The physical damage coverage is primary for autos leased, hired, rented, or borrowed without drivers. Although theoretically symbol 28 may be used for both dealer and nondealer risks, it is normally seen only in nondealer risks. The Auto Dealers' Supplementary Schedule does not even include a schedule of hired or borrowed cars.

Symbol 29—Non-owned Autos Used in Named Insured's Garage Business

29 Non-Owned “Autos” Used In Your Garage Business Any “auto” you do not own, lease, hire, rent or borrow used in connection with your garage business described in the Declarations. This includes “autos” owned by your “employees” or partners (if you


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are a partnership), members (if you are a limited liability company), or members of their households while used in your garage business. Copyright, Insurance Services Office, Inc., 1996

Symbol 29 may be used to activate liability and medical payments coverage for non-dealers. Symbol 29 (non-owned autos) is designed to afford liability coverage for automobiles the named insured does not own, hire, lease, rent, or borrow that are used in connection with the named insured's garage business. Autos that are owned by employees, partners, members of limited liability companies, or members of their households are considered nonowned autos if they are used in connection with the garage business. Also included within this symbol are customers' autos that are being tested, for example, after they have been repaired.

Symbol 30—Autos Left for Service, Repair, Storage, or Safekeeping

30 “Autos” Left With You For Service, Repair, Storage Or Safekeeping Any customer’s land motor vehicle or trailer or semi-trailer while left with you for service, repair, storage or safekeeping. Customers include your “employees”, and members of their households, who pay for the services performed. Copyright, Insurance Services Office, Inc., 1996

Symbol 30 (autos left for service, repair, storage, or safekeeping) refers to autos in the insured’s custody because of the named insured's garage operations. This symbol is reserved for garagekeepers’ coverage and provides coverage for direct and accidental loss or damage to a customer's auto or its equipment while the auto is in the insured's care for servicing, repair, storage, or safekeeping. Coverage can be written on a direct (primary or excess) basis, for an additional premium charge. Symbol 30 is the only appropriate symbol to activate garagekeepers coverage. Garage employees' autos are included in this symbol if they are paying for the work done on their autos.

Symbol 31—Autos Held for Sale

31 Dealers “Autos” And “Autos” Held For Sale By Non-Dealers Or Trailer Dealers (Physical Damage Coverages) Any “autos” and the interests in these “autos” described in Item Seven of the Dealers’ Supplementary Schedule or Item Nine of the Non-Dealers’ and Trailer Dealers’ Supplementary Schedule. Copyright, Insurance Services Office, Inc., 1996


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Symbol 31 (dealers autos and autos held for sale) is specifically reserved for physical damage coverages. Symbol 31 is incomplete in and of itself and must be accompanied by further information shown on a supplementary schedule. If the insured is a dealer, item seven of the garage coverage form—auto dealers' supplementary schedule (CA 00 07) must be completed. For nondealer insureds, item nine of the garage coverage form—nondealers' and trailer dealers' supplementary schedule (CA 00 08) must be completed. When a garage policy covers a dealership, there is no schedule of autos for liability purposes since (except for certain furnished autos) such information is not required for rating purposes. To simplify record keeping and reporting fleet changes to the insurer, a dealer may also wish to avoid the necessity of scheduling autos (other than the aforementioned furnished autos) for physical damage coverages. Symbol 31 affords the dealer that opportunity. There is no need to keep track of individual changes in the insured's fleet during the policy period. There is, however, the necessity of making sure that the total value of the insured's fleet is included in the insured's report of values at its main location. If the policy is on a reporting basis, each report must include those values. If the policy is not on a reporting basis, the limit at the main location must be high enough to include the total value of the insured's service vehicles and any furnished autos that are not specifically scheduled. Another important point which should be emphasized in connection with coverage activated by symbol 31 is that each scheduled location has its own limit of insurance. Often dealers will decide to display, store, or sell autos from some other location and assume automatic physical damage coverage is available for that additional location. This is not true! Automatic coverage is available only for a period of 45 days. In addition to the insured dealer's own autos, symbol 31 (dealers autos and autos held for sale) may be used to designate physical damage coverage for autos held for sale. Such autos may be owned outright by the dealer (e.g., used cars accepted for trade-in), financed by a division of the auto manufacturer or some other creditor (e.g., new cars financed under a floor plan), or not owned by either the dealer or any creditor (e.g., an auto owned by a third party that is in the dealer's possession on consignment for sale). Because of their ownership or security interests, other parties besides the insured dealer would suffer a financial loss if some of the autos were damaged. The dealer, therefore, has the option of purchasing coverage to protect those interests. The same advantages and disadvantages that apply in connection with this symbol 31 for owned autos also apply to these autos held for sale. That is, wherever the auto dealers' supplementary schedule shows that coverage is to be afforded, the total value of such must be included in the limit of insurance and values reported to the insurer. The boxes checked must be carefully coordinated with any other physical damage coverages available (such as those provided by a floor plan creditor under floor plan


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insurance) to avoid gaps and overlaps. This can be very confusing since the coverages included under floor plan insurance vary by floor plan creditor. The premium is determined by a rate multiplied by the total value of the autos for which coverage is intended. The broader this provision applies, the greater the premium charge. If the total value in the insured's possession at the time of a loss is greater than the total value shown in the schedule or on interim reports submitted to the insurer, the insured's loss recovery will be limited in proportion to the deficiency. This provision acts in the same manner as a coinsurance clause in a property insurance policy. In view of these provisions, it is important that the insured select options wisely and monitor actual values and values reported to the insurer.

Newly Acquired Autos

B. Owned Autos You Acquire After The Policy Begins 1. If Symbols 21, 22, 23, 24, 25, or 26 are entered next to a coverage in Item Two of the Declarations, then you have coverage for "autos" that you acquire of the type described for the remainder of the policy period. 2. But, if Symbol 27 is entered next to a coverage in Item Two of the Declarations, an "auto" you acquire will be a covered "auto" for that coverage only if: a. We already cover all "autos" that you own for that coverage or it replaces an "auto" you previously owned that had that coverage; and b. You tell us within 30 days after you acquire it that you want us to cover it for that coverage. Copyright, Insurance Services Office, Inc., 1996

This provision is exactly like the BAP provision regarding newly acquired vehicles. Paragraph B. of this section of the garage coverage form deals with coverage for autos the named insured acquires during the term of the policy after the inception date. The extent of the coverage for newly acquired vehicles depends on the symbol used for each of the coverages under the policy.

Trailers, Mobile Equipment, and Temporary Substitute Autos

C. Certain Trailers And Temporary Substitute Autos


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If Liability coverage is provided by this Coverage Form, the following types of vehicles are also covered "autos" for Liability Coverage: 1. "Trailers" with a load capacity of 2,000 pounds or less designed primarily for travel on public roads. 2. Any "auto" you do not own while used with the permission of its owner as a temporary substitute for a covered "auto" you own that is out of service because of its: a. Breakdown; b. Repair; c. Servicing; d. "Loss"; or e. Destruction. Copyright, Insurance Services Office, Inc., 1996

Paragraph C. refers only to automobile liability coverage and extends the coverage to certain trailers and temporary substitute autos if liability coverage is provided under the policy. The coverage under this provision applies whether the policy's liability coverage is provided under the broadest symbol of coverage, or whether the coverage applies only to specifically described autos. A number of state endorsements extend coverage for temporary substitute autos beyond what is contained by this provision.


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LIABILITY COVERAGE (SECTION II) Section II of the garage coverage form establishes the terms and conditions dealing specifically with liability coverage. It includes two separate insuring agreements, "who is an insured" provisions, and "limit of insurance" provisions—one dealing with garage operations involving the ownership, maintenance, or use of autos and the other dealing with all other garage operations. This section of the policy also includes liability coverage extensions, exclusions, and a deductible provision.

Insuring Agreement The garage coverage form offers a broad combination of liability coverages related to the auto hazard and premises-operations type coverage that would normally be insured under a commercial general liability (CGL) coverage form. This allows for broad coverage without gaps or overlaps between coverage forms. Because of this, the garage policy's insuring agreement is separated into two parts—one pertaining to the auto liability hazard and the other pertaining to liability related to garage operations.

Garage Operations—Other Than Covered Autos

A. Coverage "GARAGE OPERATIONS"—OTHER THAN COVERED "AUTOS" We will pay all sums an "insured" legally must pay as damages because of "bodily injury" or "property damage" to which this insurance applies caused by an "accident" and resulting from "garage operations" other than the ownership, maintenance or use of covered "autos". We have the right and duty to defend any "insured" against a "suit" asking for these damages. However, we have no duty to defend any "insured" against a "suit" seeking damages for "bodily injury" or "property damage" to which this insurance does not apply. We may investigate and settle any claim or "suit" as we consider appropriate. Our duty to defend or settle ends when the applicable Liability Coverage Limit of Insurance—"Garage Operations"—Other Than Covered "Autos" has been exhausted by payment of judgments or settlements. Copyright, Insurance Services Office, Inc., 1996

This first insuring agreement deals with liability arising from hazards other than ownership, maintenance, or use of autos. It is the CGL portion of garage liability coverage. The first insuring agreement states the insurer's promise to pay sums that an insured becomes legally obligated to pay as damages because of bodily injury or property


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damage resulting from its garage operations other than the ownership, maintenance, or use of covered autos, such as:

Premises-operations liability

Products-completed operations liability

Independent contractors liability Coverage under this insuring agreement is invoked any time the garage policy's declarations page shows a covered autos symbol next to liability coverage. Regardless of whether the covered auto symbol is as broad as symbol 21 (any auto) or as narrow as symbol 27 (specifically described autos), liability coverage is available for the named insured's garage operations. The second paragraph of this insuring agreement includes the insurer's obligation to defend insureds against suits asking for damages for bodily injury or property damage. As with other liability coverages, the insurer has the right to control the defense. The insurer's duty to defend or settle ends when the applicable limit of insurance (for garage operations other than covered autos) is exhausted by payment of judgments or settlements. Coverage described by this insuring agreement is subject to an aggregate limit as well as a per-accident limit.

Garage Operations—Covered Autos

"GARAGE OPERATIONS"—COVERED "AUTOS" We will pay all sums an "insured" legally must pay as damages because of "bodily injury" or "property damage" to which this insurance applies, caused by an "accident" and resulting from "garage operations" involving the ownership, maintenance or use of covered "autos". We will also pay all sums an "insured" legally must pay as a "covered pollution cost or expense" to which this insurance applies, caused by an "accident" and resulting from "garage operations" involving the ownership, maintenance or use of covered "autos". However, we will only pay for the "covered pollution cost or expense" if there is either "bodily injury" or "property damage" to which this insurance applies that is caused by the same "accident". We have the right and duty to defend any "insured" against a "suit" asking for such damages or a "covered pollution cost or expense". However, we have no duty to defend any "insured" against a "suit" seeking damages for "bodily injury" or "property damage" or a "covered pollution cost or expense" to which this insurance does not apply. We may investigate and settle any claim or "suit" as we consider appropriate. Our duty to defend or settle ends when the Liability Coverage Limit of Insurance—"Garage Operations"—Covered "Autos" has been exhausted by payment of judgments or settlements. Copyright, Insurance Services Office, Inc., 1996


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The second insuring agreement relates to the insured's exposure to liability loss resulting from garage operations involving the ownership, maintenance, or use of covered autos (i.e., auto liability coverages). It parallels the insuring agreement in the business auto policy (BAP) liability coverage. It contains the insurer's promise to pay sums that an insured becomes legally obligated to pay as damages because of injury or damage resulting from the ownership, maintenance, or use of a covered auto. The second paragraph extends the policy's auto liability coverage to apply to pollution cleanup cost or expense in conjunction with covered bodily injury or property damage covered by the same accident. The term "covered pollution cost or expense" is defined in the policy. The insurer is obligated to defend insureds against suits seeking damages or pollution cleanup costs. There is no duty however, to defend against suits for liability to which the policy does not apply. The insurer may investigate and settle any claim or suit as it considers appropriate. The insurer and not the insured controls the investigation and settlement of claims and suits. The insurer's duty to defend or settle ends when the limit of liability has been exhausted by payment of judgments or settlements. The apparent exhaustion of limits by loss reserves does not relieve the insurer's defense obligation. Limits are not considered exhausted until they are actually paid out.

Who Is an Insured—Covered Autos

1. Who Is An Insured a. The following are "insureds" for covered "autos": (1) You for any covered "auto". (2) Anyone else while using with your permission a covered "auto" you own, hire or borrow except: (a) The owner or anyone else from whom you hire or borrow a covered "auto". This exception does not apply if the covered "auto" is a "trailer" connected to a covered "auto" you own. (b) Your "employee" if the covered "auto" is owned by that "employee" or a member of his or her household. (c) Someone using a covered "auto" while he or she is working in a business of selling, servicing, repairing, parking or storing "autos" unless that business is your "garage operations". (d) Your customers, if your business is shown in the Declarations as an "auto" dealership. However, if a customer of yours:


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(i) Has no other available insurance (whether primary, excess or contingent), they are an "insured" but only up to the compulsory or financial responsibility law limits where the covered "auto" is principally garaged. (ii) Has other available insurance (whether primary, excess or contingent) less than the compulsory or financial responsibility law limits where the covered "auto" is principally garaged, they are an "insured" only for the amount by which the compulsory or financial responsibility law limits exceed the limit of their other insurance. (e) A partner (if you are a partnership), or a member (if you are a limited liability company), for a covered "auto" owned by him or her or a member of his or her household. (3) Anyone liable for the conduct of an "insured" described above but only to the extent of that liability. Copyright, Insurance Services Office, Inc., 1996

The definition of "insured" as respects covered autos is broken into three segments—the named insured, permissive users, and anyone liable for the conduct of an insured. The broadest coverage is afforded to the named insured. The main difference between the coverage for the named insured and that for permissive users is that there are a number of situations where the permissive user would not be covered. Exceptions to the coverage for permissive users are intended to eliminate overlaps with coverage under the permissive user’s auto liability coverage. With the exception of subparagraph (d) which applies only to auto dealerships, the garage liability "who is an insured" provision for covered autos is either the same as or very similar to the BAP liability provision. The state amendatory endorsements apply to the garage policy as well as to the business auto policy. The policy affords limited coverage for customers. Subparagraph (d) precludes coverage for the dealer's customers except for that mandated by laws. If the customer has no other available insurance, he or she is an insured but only up to the compulsory or financial responsibility law limits of the jurisdiction where the auto is principally garaged. If the customer has insurance available but it is less than that required by the law, he or she is an insured for the difference between the available limits and the required limits. Endorsements in a number of states amend the provisions of subparagraph (d) so that customers are insureds up to limits required in the state where the covered auto is principally garaged. The Commercial Lines Manual (CLM) division one—automobile rule 49.B provides that subparagraph (d) may be deleted. When unlimited coverage for customers is to be afforded, item five of the garage coverage form—auto dealers' supplementary schedule (CA 00 07) should be marked with an "X" to indicate that. It usually requires a surcharge of the policy’s liability rates.


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Who Is an Insured—Other Than Covered Autos

b. The following are "insureds" for "garage operations" other than covered "autos": (1) You. (2) Your partners (if you are a partnership), members (if you are a limited liability company), "employees", directors or shareholders but only while acting within the scope of their duties. Copyright, Insurance Services Office, Inc., 1996

The "who is an insured" provision for garage operations is limited to the named insured and the named insured's partners, members, employees, directors, or shareholders but only while they are acting within the scope of their duties. This provision is significantly more narrow than the “who is an insured” provision of the CGL policy. The garage policy does not include as an insured the spouse of an individual, partners' spouses, real estate managers, the named insured's legal representative in case of death, or newly acquired organizations. Executive officers would probably be covered as employees, although they are not specifically listed as insureds for this coverage. Many of the classes of insureds under the CGL may also be insureds under the garage policy, but they become insureds by endorsement only and are not automatically covered. These classes of insureds include a proprietor's spouse or family members, and newly acquired organizations. If the insured is an individually owned auto dealership, the individual named insured—dealers only endorsement (CA 99 18) should be attached to extend the policy definition of "you" and "your" to include the named insured's spouse if a resident of the same household. With that endorsement, the named insured's spouse is also an insured. If the policy covers an individually owned business other than a dealership, the individual named insured endorsement (CA 99 17) should be attached. It not only amends the definition of "you" and "your," it also provides drive other car coverage for members of the named insured's household. The optional broadened coverage—garages endorsement (CA 25 14), gives insured status to newly acquired garage businesses for 90 days and also to partners' spouses if the garage is a partnership. This endorsement is subject to an additional premium charge. Executive officers are probably granted insured status along with other employees of the named insured. However, the failure to specifically list them as insureds could create an ambiguity that should be addressed before a problem arises. The CGL policy differentiates between executive officers and other employees with respect to the fellow employee exclusion. Corporations insured under a garage policy


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should clarify, perhaps by manuscript endorsement, that executive officers are indeed insureds. Wording the endorsement so as to differentiate between executive officers and employees could enhance coverage for executive officers. Another optional endorsement that amends the "who is an insured" provision, the owners of garage premises endorsement (CA 25 09) is used to extend the premises liability coverage to the owner/lessor of the insured's leased premises. An additional premium will be charged for this endorsement. The optional additional insured—garages—grantor of franchise endorsement (CA 20 49) affords insured status under the garage operations other than covered autos section of the policy for the grantor of a franchise when the insured garage is operating under such franchise agreement. The endorsement covers the franchiser's vicarious liability with respect to garage operations other than covered autos. The optional additional insured—lessor of leased equipment (CA 20 47) is designed to afford coverage for the "existence hazard only" to the owner of equipment leased to a garage or repair shop. The endorsement is patterned after a CGL endorsement (CG 20 28) with the same title. The owner of the leased equipment named in the endorsement is an insured but only with respect to its liability arising out of the maintenance, operation, or use by the named insured of the leased equipment. The endorsement contains the following three exclusions:

(a) for an accident that takes place after the equipment lease expires; (b) for bodily injury, property damage, or covered pollution cost or expense arising

out of the equipment owner's sole negligence; (c) for bodily injury, property damage, or covered pollution cost or expense arising

out of "work you performed" (as defined) in connection with such leased equipment.

This garage endorsement is quite broad in scope. First, nothing in the endorsement defines what type of equipment is the subject of the endorsement. Second, although coverage is precluded under the endorsement for the additional insured lessor with respect to his or her sole negligence, this exclusion would not apply to a claim alleging contributory negligence of the lessor. Third, the endorsement does not specify that it applies only to the non-auto portion of the "who is an insured" provision. Exclusions b and c preclude coverage for "bodily injury, property damage, or covered pollution cost or expense arising out of ...". The insuring agreement as respects garage operations other than covered autos provides coverage for bodily injury or property damage liability only; coverage for covered pollution cost or expense is available only for garage operations involving ownership, maintenance, or use of covered autos. There are no provisions to give insured status in the garage policy to real estate managers or to legal representatives in case of death.

Supplementary Payments

2. Coverage Extensions


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a. Supplementary Payments In addition to the Limit of Insurance, we will pay for the "insured": (1) All expenses we incur. (2) Up to $2,000 for the cost of bail bonds (including bonds for related traffic law violations) required because of an "accident" we cover. We do not have to furnish these bonds. (3) The cost of bonds to release attachments in any "suit" against the "insured" we defend, but only for bond amounts within our Limit of Insurance. (4) All reasonable expenses incurred by the "insured" at our request, including actual loss of earnings up to $250 a day because of time off from work. (5) All costs taxed against the "insured" in any "suit" against the "insured" we defend. (6) All interest on the full amount of any judgment that accrues after entry of the judgment in any "suit" against the "insured" we defend; but our duty to pay interest ends when we have paid, offered to pay or deposited in court the part of the judgment that is within our Limit of Insurance. Copyright, Insurance Services Office, Inc., 1996

The first portion of the "coverage extensions" provision in the liability section of the garage coverage form includes the supplementary payments (claims handling expenses) for which the insurer will be responsible. The most important of these is the defense cost coverage. These supplementary payments are coverage extensions that apply in addition to the liability coverage's limit of insurance.

Out-of-State Coverage Extensions

b. Out-Of-State Coverage Extensions While a covered "auto" is away from the state where it is licensed we will: (1) Increase the Limit of Insurance for Liability Coverage to meet the limits specified by a compulsory or financial responsibility law of the jurisdiction where the covered "auto" is being used. This extension does not apply to the limit or limits specified by any law governing motor carriers of passengers or property. (2) Provide the minimum amounts and types of other coverages, such as no-fault, required of out-of-state vehicles by the jurisdiction where the covered "auto" is being used.


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We will not pay anyone more than once for the same elements of loss because of these extensions. Copyright, Insurance Services Office, Inc., 1996

The second portion of the "coverage extensions" of the liability coverage section of the garage coverage form applies when a covered auto is away from the state where it is licensed. The policy will pay minimum required limits to comply with the state (where the covered auto is being used) compulsory or financial responsibility law and will provide the minimum required amounts of coverages such as personal injury protection or uninsured motorist coverage. This provision is also found in the BAP.

Liability Exclusions The liability section insuring agreement of the garage policy describes the scope of coverage under the policy. The exclusions of the liability section then narrow coverage by excluding coverage for exposures that may be more logically covered under another type of policy or another section of this policy, can be covered for additional premium, or are uninsurable.

Expected or Intended Injury Exclusions

B. Exclusions This insurance does not apply to any of the following: 1. Expected Or Intended Injury "Bodily injury" or "property damage" expected or intended from the standpoint of the "insured". But for "garage operations" other than covered "autos" this exclusion does not apply to "bodily injury" resulting from the use of reasonable force to protect persons or property. Copyright, Insurance Services Office, Inc., 1996

The expected or intended injury exclusion is designed to preclude coverage for bodily injury or property damage that the insured expects or intends to cause. Regarding liability coverage for garage operations (other than auto liability) only, an exception to the exclusion allows coverage for bodily injury resulting from the use of reasonable force to protect persons or property. This provision is consistent with the CGL exclusion for expected or intended injury.

Contractual Exclusion


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2. Contractual Liability assumed under any contract or agreement. But this exclusion does not apply to liability for damages: a. Assumed in a contract or agreement that is an "insured contract" provided the "bodily injury" or "property damage" occurs subsequent to the execution of the contract or agreement; or b. That the "insured" would have in the absence of the contract or agreement. Copyright, Insurance Services Office, Inc., 1996

The contractual liability exclusion removes coverage for liability assumed under any contract or agreement. The exclusion does not apply however, to liability assumed in a contract that is an "insured contract" as defined in the policy or that the insured would have in the absence of the contract or agreement. The extent of contractual liability coverage provided by the policy is dependent on the definition of "insured contract". Although the contractual liability exclusion in the garage policy is the same as that found in the BAP, the definition of "insured contract" varies slightly between the forms. An elevator maintenance agreement is an insured contract for purposes of the garage policy but not the business auto. Under the garage policy the definition of insured contract specifically excludes the assumption of professional liability from an architect, engineer, or surveyor. Otherwise, the definitions in the garage and business auto policies are the same.

Workers Compensation Exclusion

3. Workers' Compensation Any obligation for which the "insured" or the "insured's" insurer may be held liable under any workers' compensation, disability benefits or unemployment compensation law or any similar law. Copyright, Insurance Services Office, Inc., 1996

This exclusion eliminates coverage for workers compensation, disability benefits and unemployment compensation required by law, whether the insured or the insured’s insurer may be held liable. The coverages are excluded under the garage coverage form because they may be treated more effectively under policies specifically designed to handle the exposures.

Employee Indemnification and Employer's Liability Exclusion


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4. Employee Indemnification And Employer's Liability "Bodily injury" to: a. An "employee" of the "insured" arising out of and in the course of: (1) Employment by the "insured"; or (2) Performing the duties related to the conduct of the "insured's" business; or b. The spouse, child, parent, brother or sister of that "employee" as a consequence of Paragraph a. above. c. A person arising out of any: (1) Refusal to employ that person; (2) Termination of that person's employment; or (3) Employment-related practices, policies, acts or omissions, such as coercion, demotion, evaluation, reassignment, discipline, defamation, harassment, humiliation or discrimination directed at that person; or d. The spouse, child, parent, brother or sister of that person as a consequence of "bodily injury" to that person at whom any of the employment-related practices described in Paragraphs (1), (2) or (3) above as directed. This exclusion applies: (1) Whether the "insured" may be liable as an employer or in any other capacity; and (2) To any obligation to share damages with or repay someone else who must pay damages because of the injury. But this exclusion does not apply to "bodily injury" to domestic "employees" not entitled to workers' compensation benefits or to liability assumed by the "insured" under an "insured contract". For the purposes of the Coverage Form, a domestic "employee" is a person engaged in household or domestic work performed principally in connection with a residence premises. Copyright, Insurance Services Office, Inc., 1996

The employee indemnification and employers liability exclusion precludes coverage for liability arising from bodily injury to an "employee" of the insured occurring in the course of employment by the insured or performing duties related to the conduct of the insured's business. It also excludes coverage for various types of employment-related practices exposures. This exclusion does not apply to bodily injury to domestic employees who


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are not entitled to workers compensation benefits or to liability assumed under an insured contract. Paragraph a. of the exclusion applies to "bodily injury," as defined in the policy, to an employee, and paragraph b. extends the application of the exclusion to his or her immediate family members who may have suffered bodily injury as a consequence of the employee's injury. Paragraph c. of the exclusion applies to bodily injury arising out of certain acts that fall into the broad category of employment-related practices, policies, acts, or omissions. This portion of the exclusion would be applicable to individuals who are not and never were employees as long as there is some connection between those individuals and the insured related to possible employment. Paragraph d. extends the application of the exclusion to the individuals' immediate family members who may have suffered bodily injury as a consequence of the individual's employment-related bodily injury.

Fellow Employee Exclusion

5. Fellow Employee "Bodily injury" to any fellow "employee" of the "insured" arising out of and in the course of the fellow "employee's" employment or while performing duties related to the conduct of your business. Copyright, Insurance Services Office, Inc., 1996

The fellow employee exclusion eliminates coverage for bodily injury to any fellow employee of the insured arising out of and in the course of the fellow employee's employment or while performing duties related to the conduct of the named insured's business. The purpose of the exclusion is to prevent the auto liability coverage from responding to a loss that should be covered under a workers compensation policy. Unlike the CGL policy, this exclusion applies to executive officers and employees alike. The term "executive officer" is not defined in the policy, however executive officers would probably be included in the defined word "employee." The garage liability policy may not apply to a claim by an employee against one of the insured's executive officers. The CGL policy, on the other hand, would not preclude coverage for such claims.

Care, Custody, or Control Exclusion

6. Care, Custody Or Control "Property damage" to or "covered pollution cost or expense" involving: a. Property owned, rented or occupied by the "insured";


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b. Property loaned to the "insured"; c. Property held for sale or being transported by the "insured"; or d. Property in the "insured's" care, custody or control. But this exclusion does not apply to liability assumed under a sidetrack agreement. Copyright, Insurance Services Office, Inc., 1996

The care, custody, or control exclusion precludes coverage for property damage to property owned, rented, occupied by, loaned to, held for sale by, being transported by, or in the care, custody, or control of the insured. Coverage for this exposure is available under other, more specific forms of insurance, such as property and garagekeepers insurance. This exclusion would also eliminate coverage for vehicle damage to rented property. Some insurers are willing to amend the exclusion so that coverage would be available for the common exposure of the insured, such as hitting the rented building with a vehicle. This exclusion also eliminates coverage for pollution cost or expense involving such property. Liability assumed under a sidetrack agreement is specifically covered by exception to this exclusion.

Leased Autos Exclusion

7. Leased Autos Any covered "auto" while leased or rented to others. But this exclusion does not apply to a covered "auto" you rent to one of your customers while their "auto" is left with you for service or repair. Copyright, Insurance Services Office, Inc., 1996

The leased autos exclusion eliminates liability coverage for any covered auto that is leased or rented out to others. A similar exclusion is found in the garage physical damage section of the policy. The exclusion does not apply if the auto is rented to a customer while the customer's auto is being serviced or repaired by the insured garage. The garage coverage form is designed for insureds in the business of selling, servicing, repairing, storing, or parking autos, but not for auto leasing or rental businesses unless the rental or leasing operation is incidental to the garage operations. If the insured garage routinely leases or rents autos, coverage is available under a BAP or a manuscript endorsement designed for the garage policy.


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The leased auto exclusion is very broad. The only exception to the exclusion is for an auto rented for a relatively short period of time by a customer whose own auto is being serviced or repaired by the insured garage.

Pollution Exclusion Applicable to Garage Operations—Other Than Covered Autos

8. Pollution Exclusion Applicable To "Garage Operations"—Other Than Covered "Autos" "Bodily injury", "property damage" or loss, cost or expense arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of "pollutants": a. At or from any premises, site or location that is or was at any time owned or occupied by, or rented or loaned to, any "insured"; b. At or from any premises, site or location that is or was at any time used by or for any "insured" or others for the handling, storage, disposal, processing or treatment of waste; c. At or from any premises, site or location on which any "insured" or any contractors or subcontractors working directly or indirectly on any "insured's" behalf are performing operations: (1) To test for, monitor, clean up, remove, contain, treat, detoxify or neutralize, or in any way respond to, or assess the effects of the "pollutants"; or (2) If the "pollutants" are brought on or to the premises, site or location in connection with such operations by such "insured", contractor or subcontractor; or d. That are or were at any time transported, handled, stored, treated, disposed of, or processed as waste by or for any "insured" or any person or organization for whom you may be legally responsible. Loss, cost or expense means those resulting from any: (1) Request, demand or order that the "insured" or others test for, monitor, clean up, remove, contain, treat, detoxify or neutralize, or in any way respond to, or assess the effects of "pollutants"; (2) Claim or suit by or on behalf of a governmental authority for damages because of testing for, monitoring, cleaning up, removing, containing, treating, detoxifying or neutralizing, or in any way responding to or assessing the effects of "pollutants". Paragraphs a. and c.(2) do not apply to "bodily injury" or "property damage" arising out of heat, smoke or fumes from a hostile fire. In this exclusion, a hostile fire means one that becomes uncontrollable, or breaks out from where it was intended to be. Copyright, Insurance Services Office, Inc., 1996


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The pollution liability exclusion applying to garage operations other than auto eliminates coverage for bodily injury, property damage, and cleanup costs arising from most types of pollution releases. A limited amount of coverage is provided because of exceptions to the exclusion. Coverage applies with respect to bodily injury or property damage liability (but not cleanup costs) arising from the following.

Smoke, heat, fumes, and such released by a hostile fire

Most types of products or completed operations

Some types of off-premises pollution releases (when the insured was not associated with the pollutants)

The pollution exclusion "discharge, dispersal, seepage, migration, release, or escape of pollutants" wording is designed to encompass virtually any means by which pollutants enter or are spread through the environment—ground, water, or air. The term "pollutants" is defined in the policy as "any solid, liquid, gaseous, or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals, and waste." (Except with respect to cleanup or related operations and the handling or disposal of waste, this definition does not apply to heat, smoke, or fumes from a hostile fire. Contamination of the air caused by smoke from an accidental fire at the insured's premises would not be an excluded pollution incident. Contamination by smoke from a "friendly fire" however, would be "pollution," and any resulting liability loss would be excluded.) There is no liability coverage (under subparagraph a. for any on-premises pollution incident, i.e., pollution confined to or originating from the insured's premises), including any location that is currently or was ever owned or occupied by or rented or loaned to the named insured or any other insured (for garage operations other than autos), under the policy. Two sections of the exclusion (subparagraphs b. and c.) involve waste treatment and disposal. There is no coverage for pollution at or from any waste disposal or processing site. There is also no coverage for pollution incidents involving waste that was actually transported, treated, disposed of, or otherwise handled by or for any insured, or any party for whom the named insured may be legally responsible. Subparagraph c. of the pollution exclusion applies to other off-premises locations where any insured or any contractor or subcontractor working on any insured's behalf is performing operations. This part of the exclusion applies only under two sets of circumstances:

(1) When the operations in questions are for pollution cleanup or related purposes (testing, monitoring, assessing, etc.); or

(2) When the pollutants have been brought to the location by the insured or the contractor or subcontractor in connection with the operations that are being performed.


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It is this part of the pollution exclusion that actually provides coverage for an exposure faced by many contractors and other service providers. If an insured garage becomes liable for bodily injury or property damage caused by a pollution incident away from the insured's owned, rented, or occupied premises, the garage liability policy will cover that liability as long as the insured was not involved in pollution cleanup operations, and the pollutants released in the incident were not brought on the premises by the insured or someone working for the insured. Nothing in the pollution exclusion directly addresses the products-completed operations hazard. The portion of the exclusion eliminating coverage for off-premises releases specifically applies only to locations at which an insured or others "are performing operations," not where operations have been completed. Unless otherwise excluded, a pollution loss involving the insured's products or completed operations would be covered by the garage liability policy. The pollution exclusion applicable to garage operations other than auto eliminates coverage for expenses involved in any request, demand, or order that any insured or others test for, monitor, clean up, or remove pollutants or take other forms of remedial action in response to pollutants. This portion of the exclusion specifically addresses circumstances when an insured is asked to undertake remedial action—not when the insured is liable for damage to the property of a third-party claimant. This does not apply when the cost of cleanup after a pollution incident is part of a property damage loss, since cleanup is part of the damage for which the insured is liable. If the pollution incident is a covered property damage loss, the cleanup would be included in the loss itself. The cleanup section of the exclusion also eliminates coverage for expenses resulting from a claim or suit brought by or on behalf of a governmental authority for damages because of testing, monitoring, or other remedial action in response to a pollution incident. Governmental agencies can sue individuals or businesses for the cost of governmentally conducted cleanup operations; environmental laws also give private citizens and organizations the right to bring such suits on behalf of the government. The garage liability policy will not respond to expenses stemming from these legal actions.

Pollution Exclusion Applicable to Garage Operations—Covered Autos

9. Pollution Exclusion Applicable To "Garage Operations"—Covered "Autos" "Bodily injury" or "property damage" arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of "pollutants": a. That are, or that are contained in any property that is: (1) Being transported or towed by, handled, or handled for movement into, onto or from, the covered "auto"; (2) Otherwise in the course of transit by or on behalf of the "insured"; or


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(3) Being stored, disposed of, treated or processed in or upon the covered "auto"; b. Before the "pollutants" or any property in which the "pollutants" are contained are moved from the place where they are accepted by the "insured" for movement into or onto the covered "auto"; or c. After the "pollutants" or any property in which the "pollutants" are contained are moved from the covered "auto" to the place where they are finally delivered, disposed of or abandoned by the "insured". Paragraph a. above does not apply to fuels, lubricants, fluids, exhaust gases or other similar "pollutants" that are needed for or result from the normal electrical, hydraulic or mechanical functioning of the covered "auto" or its parts, if the "pollutants" escape, seep, migrate, or are discharged, dispersed or released directly from an "auto" part designed by its manufacturer to hold, store, receive or dispose of such "pollutants". Paragraphs b. and c. above of this exclusion do not apply to "accidents" that occur away from premises owned by or rented to an "insured" with respect to "pollutants" not in or upon a covered "auto" if: (1) The "pollutants" or any property in which the "pollutants" are contained are upset, overturned or damaged as a result of the maintenance or use of a covered "auto"; and (2) The discharge, dispersal, seepage, migration, release or escape of the "pollutants" is caused directly by such upset, overturn or damage. Copyright, Insurance Services Office, Inc., 1996

The exceptions to the exclusion specifically identify types of sudden and accidental releases that are not excluded and are therefore covered. The garage coverage form pollution exclusion relating to the use of autos is the same as the BAP exclusion (except for references in the BAP to the release of fuels or similar pollutants from mobile equipment). Paragraph a. deals with the escape of pollutants during transportation (including loading or unloading) by a covered automobile or while being stored in the covered auto. The insured would still have coverage for third-party liability resulting from a collision with another auto that is carrying pollutants. This portion of the pollution exclusion may be amended with the attachment of the pollution liability—broadened coverage for covered autos—garage coverage forms endorsement (CA 99 55). With this endorsement, the exclusion applies only to contractually assumed liability, so coverage would still apply for direct liability. Paragraphs b. and c. eliminate coverage for pollution incidents occurring prior to loading or after unloading a covered automobile. Any coverage available would be under the garage portion of the policy. This does not apply to the escape of pollutants that are not in or on a covered auto but the covered auto causes the release.


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The exception to paragraph a. provides coverage for liability arising from the escape of fuels or other similar pollutants necessary for the normal operation of the covered automobile. The exceptions to paragraphs b. and c. provide coverage when the maintenance or use of a covered auto directly causes the pollution release. For coverage to apply, the accident must occur away from the insured's premises, and the pollutants may not be in or on the auto.

Racing Exclusion

10. Racing Covered "autos" while used in any professional or organized racing or demolition contest or stunting activity, or while practicing for such contest or activity. This insurance also does not apply while that covered "auto" is being prepared for such a contest or activity. Copyright, Insurance Services Office, Inc., 1996

The racing exclusion removes coverage for autos while they are being used in or prepared for a race, demolition contest, or stunting activity. A similar exclusion is found in the physical damage section of the policy. The exclusion applies while the auto is "being prepared for" a race, demolition contest, or stunting activity. The intent is to exclude coverage while racing and during test runs or while at the racetrack, but not while going to and from a racetrack or mechanically preparing the car at the garage.

Watercraft or Aircraft Exclusion

11. Watercraft Or Aircraft Any watercraft or aircraft except watercraft while ashore on premises where you conduct "garage operations". Copyright, Insurance Services Office, Inc., 1996

This exclusion eliminates coverage for liability regarding watercraft or aircraft except watercraft that is on the garage premises. The watercraft exclusion may be of particular concern to dealers since many of them personally use boats that are titled to the dealership. They may also acquire boats as trade-ins for a car. Coverage for liability arising out of watercraft should be purchased under some other type of liability policy.


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This exclusion applies to all aircraft and watercraft. There are no exceptions that would provide coverage for contractually assumed watercraft or aircraft liability or that arising from the activities of an independent contractor. If the garage policy is amended with the broadened coverage—garages endorsement (CA 25 14), the policy will afford coverage for any nonowned watercraft less than 26 feet in length that is not being used to carry persons or property for a charge.

Defective Products Exclusion

12. Defective Products "Property damage" to any of your "products", if caused by a defect existing in your "products" or any part of your "products", at the time it was transferred to another. Copyright, Insurance Services Office, Inc., 1996

This exclusion eliminates coverage for damage to the named insured's products if the damage is caused by a defect existing in the product when it was sold or otherwise transferred to another. This exclusion applies to damage to the entire product even if only a part of the product was defective. For the exclusion to apply, the defect must be in existence at the time the product was transferred to another. An insurer must show that a latent defect was in existence at the time of relinquishing the product in order to deny coverage. For an additional premium, this exclusion may be deleted with the broad form products coverage endorsement (CA 25 01), subject to a $250 deductible for each accident.

Work Performed Exclusion

13. Work You Performed "Property damage" to "work you performed" if the "property damage" results from any part of the work itself or from the parts, materials or equipment used in connection with the work. Copyright, Insurance Services Office, Inc., 1996

This exclusion eliminates coverage for property damage to the named insured's work if the damage results from the work or from the parts, materials, or equipment used in connection with the work. The exclusion applies whether the work was actually done by the named insured or by someone else for the named insured.


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The intent of this exclusion is similar to the defective products exclusion. The liability policy is not intended to be a guarantee of the quality or fitness of the work done by the insured. It excludes the work the insured did but covers any damage caused by the work. Unlike the defective products exclusion, there is no endorsement designed to amend this exclusion.

Loss of Use Exclusion

14. Loss Of Use Loss of use of other property not physically damaged if caused by: a. A delay or failure by you or anyone acting on your behalf to perform a contract or agreement in accordance with its terms. b. A defect, deficiency, inadequacy or dangerous condition in your "products" or "work you performed". But this exclusion,14.b., does not apply if the loss of use was caused by sudden and accidental damage to or destruction of your "products" or "work you performed" after they have been put to their intended use. Copyright, Insurance Services Office, Inc., 1996

This exclusion, commonly referred to as the "business risk exclusion," is designed to exclude coverage for business risks resulting from the insured's failure to perform contractual obligations or to perform work in a workmanlike manner. The loss of use exclusion eliminates coverage for business risks (versus pure risks) of the insured arising from the failure to perform contractual obligations on time and the failure of the insured's work or product to perform or serve the purpose warranted or represented by the insured. The exclusion pertains only to loss of use resulting from these business risks, and applies only to property that has not been physically injured. Subject to other policy provisions, loss of use of property that has been physically damaged or injured would be covered. The exclusion does not apply if the loss of use was caused by sudden and accidental damage to or destruction of the named insured's products or work after they have been put to their intended use. This is similar to the CGL impaired property exclusion.

Products Recall Exclusion

15. Products Recall


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Damages claimed for any loss, cost or expense incurred by you or others for the loss of use, withdrawal, recall, inspection, repair, replacement, adjustment, removal or disposal of your "products" or "work you performed" or other property of which they form a part, if such product, work or property is withdrawn or recalled from the market or from use by any person or organization because of a known or suspected defect, deficiency, inadequacy or dangerous condition in it. Copyright, Insurance Services Office, Inc., 1996

The products recall exclusion (also called the "sistership exclusion") eliminates coverage for damages caused by the recall, repair, replacement, and loss of use of the named insured's products and work. The products recall exclusion would particularly be relevant to an auto dealership. It would eliminate coverage for loss expenses incurred in repairing known or suspected defects in the insured's products (automobiles). It is fairly common for an auto to be recalled due to a defect or dangerous condition. The costs associated with such recall are normal costs of doing business and are not covered by liability insurance.

War Exclusion

16. War "Bodily injury" or "property damage" due to war, whether or not declared, or any act or condition incident to war. War includes civil war, insurrection, rebellion or revolution. This exclusion applies only to liability assumed under a contract or agreement. Copyright, Insurance Services Office, Inc., 1996

This exclusion removes coverage for bodily injury or property damage due to war, but only for contractually assumed liability. The war exclusion is also contained in both the CGL and auto liability coverage forms to avoid catastrophic losses to the insurer.

Liquor Liability Exclusion

17. Liquor Liability "Bodily injury" or "property damage" for which an "insured" may be held liable by reason of: a. Causing or contributing to the intoxication of any person;


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b. The furnishing of alcoholic beverages to a person under the legal drinking age or under the influence of alcohol; or c. Any statute, ordinance or regulation relating to the sale, gift, distribution or use of alcoholic beverages. This exclusion applies only if you use the premises in part for the following purposes: (1) Serving or furnishing alcoholic beverages for a charge whether or not such activity: (a) Requires a license; or (b) Is for the purpose of financial gain or livelihood; or (2) Serving or furnishing alcoholic beverages without a charge, if a license is required for such activity. Copyright, Insurance Services Office, Inc., 1996

The liquor liability exclusion eliminates coverage for bodily injury or property damage for which an insured may be held liable relating to the furnishing of alcoholic beverages. The exclusion applies only if the named insured uses the premises for serving or furnishing alcoholic beverages as part of its business or when a license is required to serve them. The policy does, however, cover "host liquor liability". The optional broadened coverage—garages endorsement (CA 25 14) includes host liquor liability coverage as one of its coverage grants. However, the absence of the endorsement does not totally eliminate host liquor liability coverage.


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Limit of Insurance

C. Limit Of Insurance 1. Aggregate Limit Of Insurance—"Garage Operations"—Other Than Covered "Autos" For "garage operations" other than the ownership, maintenance or use of covered "autos", the following applies: Regardless of the number of "insureds", claims made or "suits" brought or persons or organizations making claims or bringing "suits", the most we will pay for the sum of all damages involving "garage operations" other than "auto" is the Aggregate Limit of Insurance—"Garage Operations"—Other Than Covered "Autos" for Liability Coverage shown in the Declarations. Damages payable under the Aggregate Limit of Insurance—"Garage Operations"—Other Than Covered "Autos" consist of damages resulting from "garage operations", other than the ownership, maintenance or use of the "autos" indicated in SECTION I of this Coverage Form as covered "autos", including the following coverages, if provided by endorsement: a. "Personal injury" liability coverage; b. "Advertising injury" liability coverage; c. Host liquor liability coverage; d. Fire legal liability coverage; e. Incidental medical malpractice liability coverage; f. Non-owned watercraft coverage; g. Broad form products coverage. Damages payable under the Each "Accident" Limit of Insurance—"Garage Operations"—Other Than Covered "Autos" are not payable under the Each "Accident" Limit of Insurance—"Garage Operations"—Covered "Autos". Subject to the above, the most we will pay for all damages resulting from all "bodily injury" and "property damage" resulting from any one "accident" is the Each "Accident" Limit of Insurance—"Garage Operations"—Other Than Covered "Autos" for Liability Coverage shown in the Declarations. All "bodily injury" and "property damage" resulting from continuous or repeated exposure to substantially the same conditions will be considered as resulting from one "accident".


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The Aggregate Limit of Insurance—"Garage Operations" Other Than Covered "Autos" applies separately to each consecutive annual period and to any remaining period of less than 12 months, starting with the beginning of the policy period shown in the Declarations, unless the policy period is extended after issuance for an additional period of less than 12 months. In that case, the additional period will be deemed part of the last preceding period for purposes of determining the Aggregate Limit of Insurance—"Garage Operations"—Other Than Covered "Autos". 2. Limit Of Insurance—"Garage Operations"—Covered "Autos" For "accidents" resulting from "garage operations" involving the ownership, maintenance or use of covered "autos", the following applies: Regardless of the number of covered "autos", "insureds", premiums paid, claims made or vehicles involved in the "accident", the most we will pay for the total of all damages and "covered pollution cost or expense" combined, resulting from any one "accident" involving a covered "auto" is the Each "Accident" Limit of Insurance—"Garage Operations"—Covered "Autos" for Liability Coverage shown in the Declarations. Damages and "covered pollution cost or expense" payable under the Each "Accident" Limit of Insurance—"Garage Operations"—Covered "Autos" are not payable under the Each "Accident" Limit of Insurance—"Garage Operations"—Other Than Covered "Autos". All "bodily injury", "property damage" and "covered pollution cost or expense" resulting from continuous or repeated exposure to substantially the same conditions will be considered as resulting from one "accident". No one will be entitled to receive duplicate payments for the same elements of "loss" under this Coverage Form and any Medical Payments Coverage endorsement, Uninsured Motorists Coverage endorsement or Underinsured Motorists Coverage endorsement attached to this Coverage Part. Copyright, Insurance Services Office, Inc., 1996

The liability portion of the garage policy contains two separate limits of insurance provisions. One applies to the policy's general liability type coverage and the other applies to the auto liability coverage. An each-accident limit applies to both types of liability coverage. The provision also imposes an annual aggregate limit on the general liability type coverage only. The limit of insurance provisions describe how the limit of insurance applies, to keep the limit from "stacking" in the case of any one accident, regardless of the number of covered vehicles or the number of insureds involved. The provisions also state that losses resulting from continuous or repeated exposure to substantially the same conditions will be treated as resulting from one accident rather than multiple accidents.


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The aggregate limit of insurance applies to both the premises-operations and the products-completed operations exposures coverage under a garage policy, as well as to any of the miscellaneous general liability-type coverages that may be added by endorsement. The standard rates usually contemplate an aggregate limit of three times the per-accident limit.

Work Performed Deductible

D. Deductible We will deduct $100 from the damages in any "accident" resulting from "property damage" to an "auto" as a result of "work you performed" on that "auto". Copyright, Insurance Services Office, Inc., 1996

The deductible provision applies to property damage to an auto as a result of the insured garage's work on the auto. One hundred dollars will be deducted from the damages in any such accident. The garage policy contains an exclusion for property damage to work done by or for the named insured if the property damage results from any part of the work itself or from the parts, materials, or equipment used in connection with the work. However, if the damage to the automobile extends beyond the insured garage's work, that part of the damage is covered. For an additional premium charge, the deductible provision may be deleted with the $100 deductible for completed operations does not apply endorsement (CA 03 03).


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GARAGEKEEPERS COVERAGE (SECTION III) Section III of the garage coverage form describes the insuring agreement, "who is an insured" provision, coverage extensions, exclusions, and limit of insurance and deductible provisions for garagekeepers coverage. The garage may be legally liable for loss to its customers' autos while in the garage's care. Garage liability insurance eliminates coverage for damage to property in the insured's care, custody, or control, so garagekeepers coverage is needed to address this exposure.

Garagekeepers Insuring Agreement

A. Coverage 1. We will pay all sums the "insured" legally must pay as damages for "loss" to a covered "auto" or "auto" equipment left in the "insured's" care while the "insured" is attending, servicing, repairing, parking or storing it in your "garage operations" under: a. Comprehensive Coverage From any cause except: (1) The covered "auto's" collision with another object; or (2) The covered "auto's" overturn. b. Specified Causes Of Loss Coverage Caused by: (1) Fire, lightning or explosion; (2) Theft; or (3) Mischief or vandalism. c. Collision Coverage Caused by: (1) The covered "auto's" collision with another object; or (2) The covered "auto's" overturn. 2. We have the right and duty to defend any "insured" against a "suit" asking for these damages. However, we have no duty to defend any "insured" against a "suit" seeking damages for any loss to which this insurance does not apply. We may investigate and


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settle any claim or "suit" as we consider appropriate. Our duty to defend or settle ends for a coverage when the Limit of Insurance for that coverage has been exhausted by payment of judgments or settlements. Copyright, Insurance Services Office, Inc., 1996

The garagekeepers coverage insuring agreement contains the insurer's promise to pay damages for the insured's legal obligations for loss, including loss of use, to a customer's auto. For coverage to apply, the loss must occur while the vehicle is in the insured's care for servicing, repair, or other operations necessary or incidental to a garage business. The perils for which coverage applies are indicated in the schedule of covered autos. The insuring agreement also includes a provision regarding the insurer's duty to defend. Garagekeepers coverage applies on a legal liability basis. In order for coverage to apply, the insured must be legally liable for the loss. One of two direct coverage options is indicated in item 6. of the garage coverage form—auto dealers' supplementary schedule (CA 00 07) or item 5. of the garage coverage form—non-dealers' and trailer dealers' supplementary schedule (CA 00 08). If neither of the direct coverage options is indicated, the insurer would only respond if the insured negligently failed to protect the vehicle from loss. One of the direct coverage options makes coverage apply as excess insurance. In which case, the insurer will pay without regard to the insured's legal liability for loss. The coverage, however, is excess over any other collectible insurance regardless of whether the other insurance covers insured or the vehicle’s owner. This option allows the insured to provide coverage to its customers on a "goodwill" basis (excess of other collectible insurance) even when the garage is not legally responsible for the loss. Under the second option, coverage to applies on a primary basis. If a customer's auto is damaged by a peril insured against while the auto is in the insured's care and coverage is not otherwise excluded, the insurer will pay up to the limit of insurance less the deductible. The customer's auto insurer would not be called on to pay any of the loss unless the loss exceeds the garagekeepers coverage limit. The premium for garagekeepers insurance is based on several variables, including hazards insured against, limits of insurance, deductibles, and whether the coverage applies on a legal liability or a direct coverage basis. The least expensive option is for coverage to apply on a legal liability basis. When the direct excess coverage option is chosen, the premium is increased by 35 percent. If the direct primary option is selected, the garagekeepers insurance is subject to a 50 percent increase. Three approaches to covered perils (comprehensive, specified causes of loss, and collision) are available under the garagekeepers coverage, as indicated on the declarations page. Under comprehensive coverage, the policy will pay for direct and accidental loss or damage from any cause except collision or overturn. Since this coverage is broader than garagekeepers specified causes of loss coverage, it is also more expensive.


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Unlike comprehensive coverage, specified causes of loss coverage is limited to the specific named perils; fire, lightning, explosion, theft, mischief, or vandalism, which are not the same as the physical damage coverage specified causes of loss perils. The list of perils applicable under the physical damage section of the policy includes: windstorm, hail, earthquake, flood, and the sinking, burning, collision, or derailment of any conveyance transporting the covered auto. Garagekeepers collision coverage covers the insured's liability for loss to customers' autos caused by the covered auto's collision with another object or the covered auto's overturn. The term “collision” is quite broad. A collision can occur when the auto overturns. The auto's collision with another object does not necessarily require that the auto be moving; another object may collide with it. The insurer has the right and duty to defend any insured against a suit seeking damages for loss to customers' autos. There is no duty, however, to defend an insured against suits seeking damages for any loss that is not covered by the garagekeepers coverage. The insurer, not the insured, has the right to control the defense and settlement of claims. The insurer's duty to defend or settle ends when the limit of insurance for garagekeepers coverage has been exhausted by payment of judgments or settlements.

Who Is an Insured

3. Who Is An Insured The following are "insureds" for "loss" to covered "autos": a. You. b. Your partners (if you are a partnership), members (if you are a limited liability company), "employees", directors or shareholders while acting within the scope of their duties as such. Copyright, Insurance Services Office, Inc., 1996

The definition of who is an insured for purposes of garagekeepers coverage is the named insured and the named insured's partners (if the named insured is a partnership), members (if the named insured is a limited liability company), employees, directors, or shareholders while any of these are acting within the scope of their duties as such. Executive officers are not listed as insureds for this coverage, however, they would probably be considered insureds along with other employees. The customer is not an insured and he or she cannot make demands under the policy even when the garagekeepers coverage is written on a direct primary basis.


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If the insured garage is owned by an individual, the individual named insured—dealers only endorsement (CA 99 18) should be attached if the garage is an auto dealership, or the individual named insured endorsement (CA 99 17) if the garage is not a dealership. Under either of these endorsements, the individual's spouse will also be an insured.

Supplementary Payments

4. Coverage Extensions The following applies as Supplementary Payments. In addition to the Limit of Insurance, we will pay for the "insured": a. All expenses we incur. b. The cost of bonds to release attachments in any "suit" against the "insured" we defend, but only for bond amounts within our Limit of Insurance. c. All reasonable expenses incurred by the "insured" at our request, including actual loss of earnings up to $250 a day because of time off from work. d. All costs taxed against the "insured" in any "suit" against the "insured" we defend. e. All interest on the full amount of any judgment that accrues after entry of the judgment in any "suit" against the "insured" we defend; but our duty to pay interest ends when we have paid, offered to pay or deposited in court the part of the judgment that is within our Limit of Insurance. Copyright, Insurance Services Office, Inc., 1996

The coverage extensions provision of the garagekeepers coverage describes the supplementary payments or claims handling expenses for which the insurer will be responsible. The most important of these is defense cost coverage. These supplementary payments will be paid in addition to the limit of insurance. The garagekeepers supplementary payments are the same as garage liability supplementary payments, except for the cost of bail bonds, which is covered under garage liability coverage but is not covered under garagekeepers coverage.

Garagekeepers Exclusions

The garagekeepers exclusions eliminate coverage for contractually assumed liability for loss; loss due to theft or conversion caused by the named insured, employees, or shareholders; defective parts or materials; faulty work; and loss to various types of electronic and sound-receiving equipment.


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Contractual Exclusion

B. Exclusions 1. This insurance does not apply to any of the following: a. Contractual Obligations Liability resulting from any agreement by which the "insured" accepts responsibility for "loss". Copyright, Insurance Services Office, Inc., 1996

The contractual obligations exclusion eliminates coverage for liability when the insured contractually agrees to accept responsibility for loss. The exclusion is absolute. There are no exceptions to this garagekeepers exclusion. There are no provisions either to modify the exclusion either in the coverage form or by endorsement. Garages should therefore avoid making written or verbal promises or agreements accepting responsibility for damage to customers' autos.

Theft or Conversion Exclusion

b. Theft "Loss" due to theft or conversion caused in any way by you, your "employees" or by your shareholders. Copyright, Insurance Services Office, Inc., 1996

Theft is specifically listed as a covered peril under garagekeepers specified causes of loss coverage. Since it is not excluded, it is covered under garagekeepers comprehensive coverage. This exclusion eliminates coverage for theft or conversion caused or perpetrated by the named insured, its employees, or its shareholders. Since the definition of employee includes leased workers but not temporary workers, this exclusion does not apply to losses caused by temporary workers unless modified by endorsement.

Defective Parts and Faulty Work Exclusions

c. Defective Parts Defective parts or materials. d. Faulty Work


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Faulty "work you performed". Copyright, Insurance Services Office, Inc., 1996

Garagekeepers coverage does not cover defective parts or materials or faulty work performed by or on behalf of the named insured. The intent is to coordinate coverage under the garagekeepers section of the policy with coverage under the liability section. The exclusions do not preclude coverage for loss caused by defective parts or faulty work.

Electronic and Sound Receiving Equipment Exclusion

2. We will not pay for "loss" to any of the following: a. Tape decks or other sound reproducing equipment unless permanently installed in a covered "auto". b. Tapes, records or other sound reproducing devices designed for use with sound reproducing equipment. c. Sound receiving equipment designed for use as a citizens' band radio, two-way mobile radio or telephone or scanning monitor receiver, including its antennas and other accessories, unless permanently installed in the dash or console opening normally used by the "auto" manufacturer for the installation of a radio. d. Equipment designed or used for the detection or location of radar. Copyright, Insurance Services Office, Inc., 1996

This exclusion eliminates coverage for loss to various types of electronic equipment unless permanently installed in a covered auto. The exclusion does not apply to garagekeepers coverage for loss to customers' sound receiving equipment that is permanently installed.

Limit of Insurance and Deductible

C. Limit Of Insurance And Deductible 1. Regardless of the number of covered "autos", "insureds", premiums paid, claims made or "suits" brought, the most we will pay for each "loss" at each location is the Garagekeepers Coverage Limit of Insurance shown in the Declarations for that location


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minus the applicable deductibles for "loss" caused by collision, theft or mischief or vandalism. 2. The maximum deductible stated in the Declarations for Garagekeepers Coverage Comprehensive or Specified Causes of Loss Coverage is the most that will be deducted for all "loss" in any one event caused by theft or mischief or vandalism. 3. Sometimes to settle a claim or "suit", we may pay all or any part of the deductible. If this happens you must reimburse us for the deductible or that portion of the deductible that we paid. Copyright, Insurance Services Office, Inc., 1996

The garagekeepers limit of insurance is an amount per location. There is no limit per automobile, instead the insured selects a limit for each location based on the total value of autos expected to be at that location at any one time. The deductible, on the other hand, applies to each covered automobile. The maximum amount the insurer will pay is the limit shown in the declarations less any applicable deductibles. The deductible reduces both the amount of the loss and the limit of insurance. The garagekeepers deductible applies to collision, theft, mischief, and vandalism. There is no deductible for fire, lightning, or explosion, nor any other peril that might be covered as a comprehensive loss. A maximum deductible applies in the event of one loss caused by theft, mischief, or vandalism. The final paragraph of this provision states the insured's obligation to reimburse the insurer for deductible amounts the insurer may pay to settle a claim under garagekeepers coverage. The fact that the insurer has the right to control the defense and settlement of a claim does not relieve the insured of its responsibility for the deductible.


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PHYSICAL DAMAGE COVERAGE (SECTION IV) The physical damage section of the garage coverage form covers damage or loss of the insured’s vehicles. The coverage may be written to apply: (a) only to autos the named insured owns outright (b) only to the named insured's interest in vehicles that are financed (c) to the named insured's and any creditor's interest in vehicles that are financed. Coverage may also apply to all interests in any auto (not owned by the named insured or any creditor) while it is in the named insured's possession on consignment for sale.

Insuring Agreement

A. Coverage 1. We will pay for "loss" to a covered "auto" or its equipment under: Copyright, Insurance Services Office, Inc., 1996

The physical damage coverage insuring agreement states that the insurer will pay for direct and accidental loss or damage to a covered auto or its equipment under comprehensive, specified causes of loss, or collision coverage. The covered autos are indicated by appropriate symbols, governs what, if any, coverage applies to each auto. The garage coverage form—auto dealers' supplementary schedule (CA 00 07) or the garage coverage form—non-dealers' and trailer dealers' supplementary schedule (CA 00 08) provide additional information as to the types of autos and interests covered.

Comprehensive Coverage

a. Comprehensive Coverage. From any cause except: (1) The covered "auto's" collision with another object; or (2) The covered "auto's" overturn. Copyright, Insurance Services Office, Inc., 1996

When comprehensive coverage applies, the policy will pay for direct and accidental loss or damage from any cause except collision or overturn. This coverage is most frequently purchased by insureds to cover owned private passenger vehicles.


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Specified Causes of Loss Coverage

b. Specified Causes of Loss Coverage. Caused by: (1) Fire, lightning or explosion; (2) Theft; (3) Windstorm, hail or earthquake; (4) Flood; (5) Mischief or vandalism; or (6) The sinking, burning, collision or derailment of any conveyance transporting the covered "auto". Copyright, Insurance Services Office, Inc., 1996

Unlike comprehensive coverage, specified causes of loss coverage is limited to the specific named perils, such as fire, lightning, theft, windstorm, and vandalism. Insureds commonly purchase specified causes of loss coverage to apply to owned vehicles other than private passenger vehicles and older private passenger vehicles because of cost considerations.

Collision Coverage

c. Collision Coverage. Caused by: (1) The covered "auto's" collision with another object; or (2) The covered "auto's" overturn. Copyright, Insurance Services Office, Inc., 1996

Collision coverage insures against losses caused by the covered auto's collision with another object or the covered auto's overturn.


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Towing Coverage—Nondealers

2. Towing—Non-Dealers Only If your business is shown in the Declarations as something other than an "auto" dealership, we will pay up to the limit shown in the Declarations for towing and labor costs incurred each time a covered "auto" of the private passenger type is disabled. However, the labor must be performed at the place of disablement. Copyright, Insurance Services Office, Inc., 1996

Towing coverage is available only for nondealers and only for private passenger type vehicles. If purchased, it pays a set amount for towing a private passenger auto when disabled or for labor on the car at the place it is disabled.

Glass Breakage

3. Glass Breakage—Hitting a Bird or Animal—Falling Objects or Missiles If you carry Comprehensive Coverage for the damaged covered "auto", we will pay for the following under Comprehensive Coverage: a. Glass breakage; b. "Loss" caused by hitting a bird or animal; and c. "Loss" caused by falling objects or missiles. However, you have the option of having glass breakage caused by a covered "auto's" collision or overturn considered a "loss" under Collision Coverage. Copyright, Insurance Services Office, Inc., 1996

The glass breakage provision describes the determining factors as to where coverage lies for certain named losses. For certain named perils, (glass breakage, collision with a bird, animal, falling object, or missile) a loss will be considered a comprehensive loss. Since comprehensive coverage deductibles are typically lower than collision deductibles, this provision benefits the insured. This provision only applies when comprehensive coverage is purchased for the automobile.


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Temporary Transportation Expense

4. Coverage Extension If your business is shown in the Declarations as something other than an "auto" dealership, we will pay up to $15 per day to a maximum of $450 for temporary transportation expense incurred by you because of the total theft of a covered "auto" of the private passenger type. We will pay only for those covered "autos" for which you carry either Comprehensive or Specified Causes of Loss Coverage. We will pay for temporary transportation expenses incurred during the period beginning 48 hours after the theft and ending, regardless of the policy's expiration, when the covered "auto" is returned to use or we pay for its "loss". Copyright, Insurance Services Office, Inc., 1996

Under the garage physical damage coverage extension, the insurer will pay up to $15 a day, with a maximum of $450, for temporary transportation expense incurred by the named insured because of the total theft of a covered private passenger automobile. Coverage begins 48 hours after the theft and ends either when the stolen auto is returned to use or the insurer pays for its loss. This coverage extension is not available to an insured auto dealership for other types of insureds. The extension of coverage is automatically provided at no additional charge, but only for private passenger autos covered for comprehensive or specified causes of loss coverage.

Exclusions

B. Exclusions 1. We will not pay for "loss" caused by or resulting from any of the following. Such "loss" is excluded regardless of any other cause or event that contributes concurrently or in any sequence to the "loss". a. Nuclear Hazard (1) The explosion of any weapon employing atomic fission or fusion; or (2) Nuclear reaction or radiation, or radioactive contamination, however caused. b. War or Military Action (1) War, including undeclared or civil war;


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(2) Warlike action by a military force, including action in hindering or defending against an actual or expected attack, by any government, sovereign or other authority using military personnel or other agents; or (3) Insurrection, rebellion, revolution, usurped power or action taken by governmental authority in hindering or defending against any of these. Copyright, Insurance Services Office, Inc., 1996

The first two physical damage exclusions—nuclear hazard and war or military action—eliminate coverage caused by or resulting from these perils. The exclusions apply regardless of whether these perils alone cause the loss or they apply in addition to some other cause of loss. The exclusions prevent losses considered uninsurable because of their catastrophic potential.

Leased or Rented Auto Exclusion

2. We will not pay for "loss" to any of the following: a. Any covered "auto" leased or rented to others unless rented to one of your customers while their "auto" is left with you for service or repair. Copyright, Insurance Services Office, Inc., 1996

This exclusion eliminates coverage for any covered auto that is leased or rented out to others. The exclusion does not apply if the auto is rented to a customer of the insured while the customer's auto is being serviced or repaired by the insured. The garage coverage form is designed to address the needs of insureds in the business of selling, servicing, repairing, storing, or parking automobiles, not for auto leasing or rental businesses unless incidental to the garage operations. If the insured garage also routinely leases or rents autos, coverage is available for that exposure under a BAP.

Racing Exclusion

b. Any covered "auto" while used in any professional or organized racing or demolition contest or stunting activity, or while practicing for such contest or activity. We will also not pay for "loss" to any covered "auto" while that covered "auto" is being prepared for such contest or activity. Copyright, Insurance Services Office, Inc., 1996


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This exclusion eliminates physical damage coverage for any covered auto while being used in or prepared for a race, demolition contest, or stunting activity or while practicing. A similar exclusion precludes coverage under the liability section of the policy.


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Electronic Equipment Exclusion

c. Tapes, records, discs or other similar audio, visual or data electronic devices designed for use with audio, visual or data electronic equipment. d. Any device designed or used to detect speed measuring equipment such as radar or laser detectors and any jamming apparatus intended to elude or disrupt speed measurement equipment. e. Any electronic equipment, without regard to whether this equipment is permanently installed, that receives or transmits audio, visual or data signals and that is not designed solely for the reproduction of sound. f. Any accessories used with the electronic equipment described in Paragraph e. above. Exclusions 2.e. and 2.f. do not apply to: a. Equipment designed solely for the reproduction of sound and accessories used with such equipment, provided such equipment is permanently installed in the covered "auto" at the time of the "loss" or such equipment is removable from a housing unit which is permanently installed in the covered "auto" at the time of the "loss", and such equipment is designed to be solely operated by use of the power from the "auto's" electrical system, in or upon the covered "auto"; or b. Any other electronic equipment that is: (1) Necessary for the normal operation of the covered "auto" or the monitoring of the covered "auto's" operating system; or (2) An integral part of the same unit housing any sound reproducing equipment described in a. above and permanently installed in the opening of the dash or console of the covered "auto" normally used by the manufacturer for installation of a radio. Copyright, Insurance Services Office, Inc., 1996

This exclusion precludes coverage for loss to various types of electronic equipment like the one in the 1993 BAP.

False Pretense Exclusion

3. False Pretense We will not pay for "loss" to a covered "auto" caused by or resulting from:


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a. Someone causing you to voluntarily part with it by trick or scheme or under false pretenses; or b. Your acquiring an "auto" from a seller who did not have legal title. Copyright, Insurance Services Office, Inc., 1996

False pretense is an extension of the theft peril. This exclusion removes coverage for loss of a covered auto that the insured is tricked into giving up, or loss arising from the purchase of an auto from someone who does not possess legal title to the auto. This exclusion may be deleted for a premium charge, using false pretense coverage endorsement (CA 25 03).

Dealer Exclusions

4. If your business is shown in the Declarations as an "auto" dealership, we will not pay for: a. Your expected profit including loss of market value or resale value. b. "Loss" to any covered "auto" displayed or stored at any location not shown in Item Three of the Declarations if the "loss" occurs more than 45 days after your use of the location begins. c. Under the Collision Coverage, to any covered "auto" while being driven or transported from the point of purchase or distribution to its destination if such points are more than 50 road miles apart. d. Under the Specified Causes of Loss Coverage, to "loss" to any covered "auto" caused by or resulting from the collision or upset of any vehicle transporting it. Copyright, Insurance Services Office, Inc., 1996

These exclusions apply only if the garage policy covers an auto dealership. The first exclusion eliminates coverage for the named insured's expected profit, including loss of market value or resale value. The second exclusion mandates that the insured notify the insurer of new locations within 45 days of their use. The third eliminates coverage for collision damage to an auto being driven or transported more than 50 road miles from its point of purchase or distribution to its destination. The last eliminates coverage under specified causes of loss coverage for loss caused by or resulting from the collision of a vehicle transporting the auto. The first of this group of physical damage exclusions directed to auto dealers precludes coverage for the dealer's expected profit including loss of market value or resale value.


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The second of these exclusions eliminates coverage for loss to autos at new locations if the loss occurs more than 45 days after the insured begins to use the location. The insured would have coverage at the additional location for up to 45 days, after which the insurer must be notified for coverage to continue. The third exclusion (4.c.) eliminates coverage for collision damage to an auto being driven or transported more than 50 road miles from its point of purchase or distribution to its destination. Even if the auto were involved in a collision 2 blocks from the point of purchase or 2 blocks from the destination, the exclusion would apply. This exclusion (4.c.) may be deleted, subject to additional conditions and premium charge, the dealers driveaway collision coverage endorsement (CA 25 02). The last exclusion (4.d.) that applies to auto dealers, for loss caused by collision or upset of a vehicle transporting any covered auto, eliminates coverage under specified causes of loss coverage for such losses. The exclusion applies only to specified causes of loss coverage and not to comprehensive coverage.

Wear and Tear Exclusion

5. Other Exclusions We will not pay for "loss" caused by or resulting from any of the following unless caused by other "loss" that is covered by this insurance: a. Wear and tear, freezing, mechanical or electrical breakdown; b. Blowouts, punctures or other road damage to tires. Copyright, Insurance Services Office, Inc., 1996

This exclusion eliminates coverage for loss caused by normal breakdown and road hazards, which are normal and expected costs that accompany the ownership of an automobile.

Limits of Insurance

C. Limits of Insurance 1. The most we will pay for "loss" to any one covered "auto" is the lesser of: a. The actual cash value of the damaged or stolen property as of the time of "loss"; or


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b. The cost of repairing or replacing the damaged or stolen property with other property of like kind and quality. 2. For those businesses shown in the Declarations as "auto" dealerships, the following provisions also apply: a. Regardless of the number of covered "autos" involved in the "loss", the most we will pay for all "loss" at any one location is the amount shown in the Auto Dealers Supplementary Schedule for that location. Regardless of the number of covered "autos" involved in the "loss", the most we will pay for all "loss" in transit is the amount shown in the Auto Dealers Supplementary Schedule for "loss" in transit. b. Quarterly or Monthly Reporting Premium Basis If, on the date of your last report, the actual value of the covered "autos" at the "loss" location exceeds what you last reported, when a "loss" occurs we will pay only a percentage of what we would otherwise be obligated to pay. We will determine this percentage by dividing your total reported value for the involved location by the value you actually had on the date of your last report. If the first report due is delinquent on the date of "loss", the most we will pay will not exceed 75 percent of the Limit of Insurance shown in the Auto Dealers Supplementary Schedule for the applicable location. c. Non-Reporting Premium Basis If, when "loss" occurs, the total value of your covered "autos" exceeds the Limit of Insurance shown in the Declarations, we will pay only a percentage of what we would otherwise be obligated to pay. We will determine this percentage by dividing the limit by the total values you actually had when "loss" occurred. Copyright, Insurance Services Office, Inc., 1996

The limit of insurance provision describes how much the insurer will pay in the event of loss. The most that will be paid is the lesser of the actual cash value (ACV) or the cost to repair or replace with like kind and quality. This limit provision applies if the insured is an auto dealer. It refers the reader to the garage coverage form—auto dealers' supplementary schedule (CA 00 07) where a limit is shown for each covered location and for autos in transit. The insurer will not pay a greater amount than the limits shown in the schedule. The second and third paragraphs of the limit provision deal with how partial losses will be paid when the actual values are less than those shown in the schedule. It is extremely important to coordinate the dealer's floor plan insurance and garage insurance to avoid gaps or overlaps.


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This limit of insurance indicates the maximum physical damage loss that the insurer will pay, as well as the most it will pay at any one location or in the course of transit. It also describes what amounts to a 100 percent coinsurance provision. Even if an insured loss is below the maximum shown on the schedule, the insured may only recover a portion of the loss if actual values are greater than the limit of insurance purchased. An insured dealer will in most cases want to set its limits at maximum values exposed at any one time. The value of inventories exposed to loss under the policy is directly correlated to what is shown on the auto dealer’s supplementary schedule and may vary by coverage. The way the coinsurance clause applies differs depending on whether insurance is written on a reporting, or non-reporting basis. When the garage policy is on a reporting basis, the insured pays a deposit premium and agrees to report the total value of covered autos at each location. For the main sales location, the total value must include the value of autos furnished to the named insured, executive officers, employees and covered autos that are temporarily displayed or stored at locations not listed as a location where the insured conducts garage operations. The total value at the main location must also include the value of all service vehicles. For monthly reporting, the report must be furnished to the insurer by the fifteenth day of each month. The total values will be those values the insured had on the last business day of the preceding month. For quarterly reporting, the report must be furnished by the fifteenth day of the fourth month after the policy begins and continue every third month thereafter. The total value is to be that of the last business day of every third month during the policy period. The non-reporting basis coinsurance clause differs only slightly from the reporting basis. Of course, with a non-reporting premium basis, the insured is not subject to a possible penalty caused by failure to report values to the insurer on a timely basis. Also, the reporting and non-reporting policies vary on the valuation date. On a non-reporting policy, the total value as of the date of loss is the date on which any coinsurance penalty is determined.

Deductible

D. Deductible For each covered "auto", our obligation to pay for, repair, return or replace damaged or stolen property will be reduced by the applicable deductible shown in the Declarations provided that: Copyright, Insurance Services Office, Inc., 1996

A deductible applies to most garage physical damage losses, the amount of which, for a particular loss, is shown in the policy's declarations. Separate deductible provisions apply for auto dealers and nondealers.


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1. "Auto" Dealers Only Special Deductible Provisions If your business is shown in the Declarations as an "auto" dealership: a. The Comprehensive or Specified Causes of Loss Coverage deductible applies only to "loss" caused by theft or mischief or vandalism. b. Regardless of the number of covered "autos" damaged or stolen, the per "loss" deductible for Comprehensive or Specified Causes of Loss Coverage shown in the Declarations is the maximum deductible applicable for all "loss" in any one event caused by any theft or mischief or vandalism. Copyright, Insurance Services Office, Inc., 1996

For auto dealers, the deductible applying for comprehensive or specified causes of loss coverage only applies to loss caused by theft or mischief or vandalism. No deductible applies for fire, lightning, explosion, windstorm, hail, earthquake, or flood. Under comprehensive coverage, no deductible applies to glass breakage (unless caused by mischief or vandalism), hitting a bird or animal, or falling objects. In addition to a per-vehicle theft, mischief, or vandalism deductible, a maximum per loss deductible that applies.

Non-Dealers Only Special Deductible Provisions

2. Non-dealers Only Special Deductible Provisions If your business is shown in the Declarations as something other than an "auto" dealership, the Comprehensive Coverage deductible does not apply to "loss" caused by fire or lightning. Copyright, Insurance Services Office, Inc., 1996

The non-dealers comprehensive deductible does not apply to loss caused by fire or lightning.


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GARAGE CONDITIONS (SECTION V) This section of the garage coverage form contains all the conditions applicable to the basic provisions of the policy. The first five conditions affect loss handling, and the next eight deal with other general conditions. All of the conditions are identical to those found in the business auto policy (BAP) except for the coverage territory relating to garage products sold by the insured.

Loss Conditions

The loss conditions of the policy describe (a) the rules for determining the amount of a physical damage loss by appraisal when the insured and insurer disagree; (b) the insured's duties in the event of an accident, claim, suit, or loss; (c) certain prohibitions against anyone bringing a legal action against the insurer without first fulfilling all the terms of the policy; (d) the insurer's payment options for physical damage losses; and (e) the insurer's right of subrogation.

Appraisal for Physical Damage Loss

A. Loss Conditions 1. Appraisal For Physical Damage Loss If you and we disagree on the amount of "loss", either may demand an appraisal of the "loss". In this event, each party will select a competent appraiser. The two appraisers will select a competent and impartial umpire. The appraisers will state separately the actual cash value and amount of "loss". If they fail to agree, they will submit their differences to the umpire. A decision agreed to by any two will be binding. Each party will: a. Pay its chosen appraiser; and b. Bear the other expenses of the appraisal and umpire equally. If we submit to an appraisal, we will still retain our right to deny the claim. Copyright, Insurance Services Office, Inc., 1996

In the event of disagreement between the insured and insurer on the amount of loss under any of the physical damage coverages, this condition outlines the rules governing the way the disagreement is to be arbitrated. The insurer still retains the right to deny the claim even if the matter has been submitted to an appraiser.


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Duties in the Event of Accident, Claim, Suit, or Loss

2. Duties In The Event Of Accident, Claim, Suit Or Loss We have no duty to provide coverage under this policy unless there has been full compliance with the following duties: a. In the event of "accident", claim, "suit" or "loss", you must give us or our authorized representative prompt notice of the accident or "loss". Include: (1) How, when and where the "accident" or "loss" occurred; (2) The "insured's" name and address; and (3) To the extent possible, the names and addresses of any injured persons and witnesses. b. Additionally, you and any other involved "insured" must: (1) Assume no obligation, make no payment or incur no expense without our consent, except at the "insured's" own cost. (2) Immediately send us copies of any request, demand, order, notice, summons or legal paper received concerning the claim or "suit". (3) Cooperate with us in the investigation or settlement of the claim or defense against the "suit". (4) Authorize us to obtain medical records or other pertinent information. (5) Submit to examination at our expense, by physicians of our choice, as often as we reasonably require. c. If there is "loss" to a covered "auto" or its equipment you must also do the following: (1) Promptly notify the police if the covered "auto" or any of its equipment is stolen. (2) Take all reasonable steps to protect the covered "auto" from further damage. Also keep a record of your expenses for consideration in the settlement of the claim. (3) Permit us to inspect the covered "auto" and records proving the "loss" before its repair or disposition. (4) Agree to examinations under oath at our request and give us a signed statement of your answers. Copyright, Insurance Services Office, Inc., 1996


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Condition 2. contains the insured's obligations at the time of an accident, claim, suit, or loss. The provision states that the insurer has no duty to provide coverage under the policy unless there has been full compliance with the duties listed. The condition requires that accidents or losses be promptly reported to the insurer, with sufficient details for the insurer to be able to investigate the accident or loss, and that insureds cooperate with the insurer in investigating, settling, or defending a claim. Paragraph a of this policy condition deals with the named insured's general duties in the event of an accident, claim, suit, or loss, including notice requirements, regardless of the type of coverage is involved. Paragraph b then details additional duties and restrictions of the named insured and any other involved insureds for coverage other than physical damage, particularly involving legal liability issues. This paragraph prohibits the assumption of any obligation without the insurer's consent, as well as specifying the insured’s duty to cooperate with the insurer in the investigation or settlement of a claim or defense against a suit. Paragraph c deals with additional duties of the insured in the event of a loss under auto physical damage coverage. It requires that the police be notified in the event of a stolen auto or stolen equipment of the auto, and that the insured take reasonable steps to protect a damaged auto from further damage. If the insured garage has purchased the false pretense coverage endorsement (CA 25 03), the insured must make an effort to obtain a warrant for the arrest of a perpetrator and be able to show that reasonable efforts were made.

Legal Action Against Insurer

3. Legal Action Against Us No one may bring a legal action against us under this Coverage Form until: a. There has been full compliance with all the terms of this Coverage Form; and b. Under Liability Coverage, we agree in writing that the "insured" has an obligation to pay or until the amount of that obligation has finally been determined by judgment after trial. No one has the right under this policy to bring us into an action to determine the "insured's" liability. Copyright, Insurance Services Office, Inc., 1996

This provision is designed to prevent claimants from bringing the insurer directly into a suit, circumventing the intended process of the policy. Any action to determine negligence is between the insured and the third party filing suit.


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Loss Payment Options—Physical Damage

4. Loss Payment—Physical Damage Coverages At our option we may: a. Pay for, repair or replace damaged or stolen property; b. Return the stolen property, at our expense. We will pay for any damage that results to the "auto" from the theft; or c. Take all or any part of the damaged or stolen property at an agreed or appraised value. Copyright, Insurance Services Office, Inc., 1996

This condition gives the insurer the right to settle a physical damage loss in any way it chooses. The insurer's options are to pay for, repair, or replace damaged or stolen property. In the event of recovery of stolen property, the insurer may return the property and pay for any damage that occurred in connection with the theft.

Transfer of Rights of Recovery

5. Transfer Of Rights Of Recovery Against Others To Us If any person or organization to or for whom we make payment under this Coverage Form has rights to recover damages from another, those rights are transferred to us. That person or organization must do everything necessary to secure our rights and must do nothing after "accident" or "loss" to impair them. Copyright, Insurance Services Office, Inc., 1996

Condition 5 describes the insurer's right of subrogation if it makes payment under the garage coverage form. The person or organization to or for whom the insurer makes payment must protect this right and do nothing after loss to impair it. Subrogation rights may, however, be waived before accident or loss.

B. General Conditions


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The general conditions of the garage policy deal with issues such as the effects on coverage under the policy in the event of (a) bankruptcy, (b) fraud, (c) liberalization of coverage without additional premium charge, and (d) multiple policies applicable to the same claim or loss (whether the same insurer is involved or not). This section of the policy also states that there is no bailee coverage available under physical damage coverage. These conditions also address the insurer's right to audit exposures under the policy and charge premiums in accordance with actual exposures. The coverage territory is also defined herein.

Bankruptcy

1. Bankruptcy Bankruptcy or insolvency of the "insured" or the "insured's" estate will not relieve us of any obligations under this Coverage Form. Copyright, Insurance Services Office, Inc., 1996

This condition affirms the insurer's obligations under the policy regardless of the insured's financial condition. The insurer must provide coverage in accordance with the terms of the policy despite the insured's bankruptcy. This condition does not prevent the insurer's canceling or non-renewing the policy, but as long as it is in force, the insured's insolvency does not affect the applicability of the policy's coverage.

Concealment, Misrepresentation, or Fraud

2. Concealment, Misrepresentation Or Fraud This Coverage Form is void in any case of fraud by you at any time as it relates to this Coverage Form. It is also void if you or any other "insured", at any time, intentionally conceal or misrepresent a material fact concerning: a. This Coverage Form; b. The covered "auto"; c. Your interest in the covered "auto"; or d. A claim under this Coverage Form. Copyright, Insurance Services Office, Inc., 1996

This condition states that the garage coverage form is void in any case of fraud by the named insured at any time as it relates to the coverage form. It is also void if any insured


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at any time intentionally conceals or misrepresents a material fact concerning the coverage form, the covered auto, the named insured's interest in the covered auto, or a claim under the coverage form. The portion of this condition relating to fraud applies only to the named insured. However, the portion that relates to intentional concealment or misrepresentation of a material fact applies to any insured (the named insured, permissive users, vicariously liable insureds, and sometimes customers for liability related to autos; and the named insured, partners, employees, directors, or shareholders for garagekeepers insurance and other liability). With the explosion of requests for additional insured status, this is a condition that bears emphasis.

Liberalization

3. Liberalization If we revise this Coverage Form to provide more coverage without additional premium charge, your policy will automatically provide the additional coverage as of the day the revision is effective in your state. Copyright, Insurance Services Office, Inc., 1996

This condition provides the insured additional coverage automatically if the insurer revises the garage coverage form to provide more coverage at no additional premium charge. This additional coverage becomes effective on the day the policy revision is effective in the named insured's state.

No Benefit to Bailee—Physical Damage Coverages

4. No Benefit To Bailee—Physical Damage Coverages We will not recognize any assignment or grant any coverage for the benefit of any person or organization holding, storing or transporting property for a fee regardless of any other provision of this Coverage Form. Copyright, Insurance Services Office, Inc., 1996

This policy condition, routinely found in property insurance policies, is designed to ensure that no person or organization holding, storing, or transporting property for a fee will stand to gain from coverage under this policy.

Other Insurance


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5. Other Insurance a. For any covered "auto" you own, this Coverage Form provides primary insurance. For any covered "auto" you don't own, the insurance provided by this Coverage Form is excess over any other collectible insurance. However, while a covered "auto" which is a "trailer" is connected to another vehicle, the Liability Coverage this Coverage Form provides for the "trailer" is: (1) Excess while it is connected to a motor vehicle you do not own. (2) Primary while it is connected to a covered "auto" you own. b. For Hired Auto Physical Damage Coverage, any covered "auto" you lease, hire, rent or borrow is deemed to be a covered "auto" you own. However, any "auto" that is leased, hired, rented or borrowed with a driver is not a covered "auto". c. Regardless of the provisions of Paragraph a. above, this Coverage Form's Liability coverage is primary for any liability assumed under an "insured contract". d. When this Coverage Form and any other Coverage Form or policy covers on the same basis, either excess or primary, we will pay only our share. Our share is the proportion that the Limit of Insurance of our Coverage Form bears to the total of the limits of all the Coverage Forms and policies covering on the same basis. Copyright, Insurance Services Office, Inc., 1996

The "other insurance" condition explains how coverage applies when more than one policy covers the same loss. In such cases, coverage is primary for the named insured's owned autos and is excess for any other covered auto. Liability insurance follows the auto rather than the driver. When a nonowned trailer is involved, the policy is primary when that trailer is connected to the insured's own auto and is excess when connected to any other covered auto. The general rule as to which policy is primary and which is excess does not apply with respect to hired auto physical damage coverage (except when the auto is hired with a driver) and contractually assumed liability coverage. In both situations, the policy is primary even though the covered autos in question are not owned by the named insured. In the case of an auto hired with a driver, there is no coverage at all under the policy l unless the autos leased, hired, rented or borrowed with drivers—physical damage coverage endorsement (CA 20 33) is attached. The final paragraph of the "other insurance" condition deals with the situation where more than one policy covers a loss on the same basis, whether primary or excess. In either case, the garage coverage form will pay in proportion to the total limits (contribution by limits of all the policies covering on the same basis). If an auto dealer purchases direct primary garagekeepers coverage, this condition provides for a pro rata distribution of the loss between the customer's insurance and the garagekeepers when a loss results from an occurrence where the insured was not negligent. A more common


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practice, however, is for the insurer of the garage to pay the loss and not bring the customer's insurance into it.


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Premium Audit

6. Premium Audit a. The estimated premium for this Coverage Form is based on the exposures you told us you would have when this policy began. We will compute the final premium due when we determine your actual exposures. The estimated total premium will be credited against the final premium due and the first Named Insured will be billed for the balance, if any. If the estimated total premium exceeds the final premium due, the first Named Insured will get a refund. b. If this policy is issued for more than one year, the premium for this Coverage Form will be computed annually based on our rates or premiums in effect at the beginning of each year of the policy. Copyright, Insurance Services Office, Inc., 1996

The premium audit condition states that the premium under the garage coverage form is an estimate only, based on estimated exposures. The insurer will compute the actual premium at the end of the policy period based on actual exposures.

Policy Period, Coverage Territory

7. Policy Period, Coverage Territory Under this Coverage Form, we cover: a. "Bodily injury", "property damage" and "losses" occurring; and b. "Covered pollution cost or expense" arising out of "accidents" occurring during the policy period shown in the Declarations and within the coverage territory. The coverage territory is: a. The United States of America; b. The territories and possessions of the United States of America; c. Puerto Rico; and d. Canada. We also cover "bodily injury", "property damage", "covered pollution cost or expense" and "losses" while a covered "auto" is being transported between any of these places.


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The coverage territory is extended to anywhere in the world if the "bodily injury" or "property damage" is caused by one of your "products" which is sold for use in the United States of America, its territories or possessions, Puerto Rico or Canada. The original "suit" for damages resulting from such "bodily injury" or "property damage" must be brought in one of these places. Copyright, Insurance Services Office, Inc., 1996

This condition defines the parameters under which the garage coverage form will apply regarding time and territory. The coverage territory under the garage policy is worldwide respecting garage products sold for use within the described territory. Otherwise, the coverage territory is the United States, its territories and possessions, Puerto Rico, and Canada, or while a covered auto is being transported between any of these places. The first part of this condition deals with the coverage trigger of the garage coverage form. Liability coverage under the garage coverage form is triggered by bodily injury or property damage that occurs during the policy period, similar to the CGL policy "occurrence" coverage trigger. The only difference between the two coverage triggers is for garage liability coverage to apply, the injury or damage must have been caused by an "accident;" for CGL coverage to apply, the bodily injury or property damage must have been caused by an "occurrence." The term "accident" is defined in the garage coverage form as follows.

"Accident" includes continuous or repeated exposure to the same conditions resulting in "bodily injury" or "property damage."

The term "occurrence" is defined in the commercial general liability coverage form as follows.

"Occurrence" means an accident, including continuous or repeated exposure to substantially the same general harmful conditions. Copyright, Insurance Services Office, Inc., 1996.

Liability coverage under the BAP, motor carrier, or trucker’s policy is triggered by an accident that occurs during the policy period and rather than by the bodily injury or property damage that results from the accident. Garage liability coverage for covered pollution costs or expenses is triggered by costs or expenses arising out of accidents that occur during the policy period, and within the coverage territory. Pollution cleanup coverage is triggered in a manner that differs from other garage policy's liability coverage.


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Two or More Coverage Forms or Policies Issued by Insurer

8. Two Or More Coverage Forms Or Policies Issued By Us If this Coverage Form and any other Coverage Form or policy issued to you by us or any company affiliated with us apply to the same "accident", the aggregate maximum Limit of Insurance under all the Coverage Forms or policies shall not exceed the highest applicable Limit of Insurance under any one Coverage Form or policy. This condition does not apply to any Coverage Form or policy issued by us or an affiliated company specifically to apply as excess insurance over this Coverage Form. Copyright, Insurance Services Office, Inc., 1996

This condition prevents the stacking of limits if the insurer or any of its affiliates has issued more than one policy to the named insured that applies to the same accident. The condition does not apply to any coverage issued specifically as excess insurance.


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DEFINITIONS (SECTION VI) The garage definitions are included in Section VI of the coverage form. Throughout the policy, wherever a term is used that is defined within the policy, the term is shown in quotation marks. The garage definitions play a major role in determining what is and is not covered by the form. It is important to review carefully the provision itself as well as the definition of the terms contained in the provision.

"Accident"

A. "Accident" includes continuous or repeated exposure to the same conditions resulting in "bodily injury" or "property damage". Copyright, Insurance Services Office, Inc., 1996

The word "accident" as used in the garage policy includes "continuous or repeated exposure to the same conditions" resulting in bodily injury or property damage.

"Auto"

B. "Auto" means a land motor vehicle, "trailer" or semi-trailer. Copyright, Insurance Services Office, Inc., 1996

The definition of "auto" in the garage coverage form differs from that in the BAP, truckers, and commercial general liability (CGL) coverage forms. Under the garage coverage form there is no distinction between autos and mobile equipment for liability, since the garage policy applies to exposures of both auto liability and general liability.

"Bodily Injury"

C. "Bodily injury" means bodily injury, sickness or disease sustained by a person including death resulting from any of these. Copyright, Insurance Services Office, Inc., 1996

The term "bodily injury" is used extensively throughout the liability section of the garage coverage form. The claim must involve bodily injury or sickness or disease as a result of the injury. The term also encompasses death resulting from bodily injury, sickness, or disease. This definition does not cover hazards such as libel, slander, false arrest, but


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coverage may be added with either the personal injury liability coverage—garages endorsement (CA 25 08) or the broadened coverage—garages endorsement (CA 25 14).

"Covered Pollution Cost or Expense"

D. "Covered pollution cost or expense" means any cost or expense arising out of: 1. Any request, demand or order; or 2. Any claim or "suit" by or on behalf of a governmental authority demanding that the "insured" or others test for, monitor, clean up, remove, contain, treat, detoxify or neutralize, or in any way respond to, or assess the effects of "pollutants". "Covered pollution cost or expense" does not include any cost or expense arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of "pollutants": a. That are, or that are contained in any property that is: (1) Being transported or towed by, handled, or handled for movement into, onto or from the covered "auto"; (2) Otherwise in the course of transit by or on behalf of the "insured"; (3) Being stored, disposed of, treated or processed in or upon the covered "auto"; or b. Before the "pollutants" or any property in which the "pollutants" are contained are moved from the place where they are accepted by the "insured" for movement into or onto the covered "auto"; or c. After the "pollutants" or any property in which the "pollutants" are contained are moved from the covered "auto" to the place where they are finally delivered, disposed of or abandoned by the "insured". Paragraph a. above does not apply to fuels, lubricants, fluids, exhaust gases or other similar "pollutants" that are needed for or result from the normal electrical, hydraulic or mechanical functioning of the covered "auto" or its parts, if the "pollutants" escape, seep, migrate, or are discharged, dispersed or released directly from an "auto" part designed by its manufacturer to hold, store, receive or dispose of such "pollutants". Paragraphs b. and c. above do not apply to "accidents" that occur away from premises owned by or rented to an "insured" with respect to "pollutants" not in or upon a covered "auto" if: (1) The "pollutants" or any property in which the "pollutants" are contained are upset, overturned or damaged as a result of the maintenance or use of a covered "auto"; and


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(2) The discharge, dispersal, seepage, migration, release or escape of the "pollutants" is caused directly by such upset, overturn or damage. Copyright, Insurance Services Office, Inc., 1996

The definition of "covered pollution cost or expense" describes what is and is not included as a covered pollution cost or expense. What is not "covered pollution cost or expense" is virtually identical to the pollution exclusion in the liability coverage section of the policy. If bodily injury and property damage coverage for the exposure is excluded under the liability section, the pollution cleanup cost or expense is excluded by virtue of this definition. There is no coverage in the garage policy for pollution cleanup costs except in connection with garage liability arising from covered autos.

"Employee"

E. "Employee" includes a "leased worker". "Employee" does not include a "temporary worker". Copyright, Insurance Services Office, Inc., 1996

The definition of "employee," deals with whether leased workers and temporary workers are to be considered employees for purposes of policy provisions. Employee leasing has become a widespread practice. Insurers have begun to address the treatment of leased workers in insurance policies. The first type of coverage in which this issue arose is workers compensation, which employers are required by law to carry on employees. In employee leasing situations there is some question as to who is the official employer charged with the responsibility of securing workers compensation insurance coverage. There is also some ambiguity regarding whether one of the party's purchasing such coverage protects the other party against tort liability suits. The definition of employee is applicable in two garage liability exclusions, one garagekeepers exclusion, in the "who is an insured" provisions for both garage liability and garagekeepers coverage, in three covered auto designation symbols, and in the definitions of "insured contract" and "temporary worker." The garage liability exclusions are the same in the garage policy as they are in the business auto policy. The coverage for injury to leased workers endorsement (CA 23 25) can be used to redirect the application of the employee indemnification and employers liability exclusion so that it eliminates coverage for employees, but not for leased workers. There is, however, no endorsement to restrict the application of the fellow employee exclusion. Neither exclusion applies to temporary workers.


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The garagekeepers exclusion eliminates coverage for loss due to theft or conversion caused in any way by the named insured, the named insured's employees (including leased workers but not temporary workers), or shareholders of the named insured. Regarding the "who is an insured" provisions, the primary area in which employees and leased workers differ from temporary workers is in the liability coverage related to garage operations other than covered autos and garagekeepers coverage. In both, temporary workers are not insureds and could not be accorded insured status under any circumstance. For covered auto liability coverage, temporary workers are eligible to become permissive user insureds in exactly the same manner as employees. There is no restriction in the garage policy to prevent non-employees from insured status while they are moving property to or from a covered auto. Regarding covered auto designation symbols, an auto that is owned by an employee or a member of the employee's household that is being used in the named insured's garage business fits the description of symbol 29 (nonowned autos used in your garage business). An auto leased, hired, rented, or borrowed from a temporary worker would be classified under symbol 28 (hired autos only). Symbol 30 (autos left with you for service, repair, storage, or safekeeping) is for customers' autos left with the garage, and the description of such provides that for purposes of this, employees and members of their households are customers if they pay for the services performed. Within the definitions section of the policy, the term "employee" is used to indicate that employees may enter into an auto rental contract that is an "insured contract" according to the policy definition. The term is also used within the definition of temporary worker to indicate that an appropriate use of such a worker could be for supplementing the workforce during employee absences.

"Garage Operations"

F. "Garage operations" means the ownership, maintenance or use of locations for garage business and that portion of the roads or other accesses that adjoin these locations. "Garage operations" includes the ownership, maintenance or use of the "autos" indicated in SECTIONI of this Coverage Form as covered "autos". "Garage operations" also include all operations necessary or incidental to a garage business. Copyright, Insurance Services Office, Inc., 1996

The definition of "garage operations" is used throughout the coverage form to describe what is covered. The term "garage operations" means the ownership, maintenance, or use of locations for a garage business, including the roads or accesses that adjoin these locations. This portion of the definition provides coverage for the garage's premises liability exposure.


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Garage operations also includes the ownership, maintenance, or use of autos that are covered autos. To determine what autos are covered, the definition refers to Section I of the policy to see what symbols are shown in the policy's declarations. This portion of the definition provides for the insured's auto exposures. The term "garage operations" also includes all operations necessary or incidental to a garage business. This portion of the definition provides for other garage exposures not included in the previous portions of the definition. The operations must be necessary or incidental to the garage business. The insured must purchase a CGL policy to cover those operations that are not necessary or incidental to a garage business.

"Insured"

G. "Insured" means any person or organization qualifying as an insured in the Who Is an Insured provision of the applicable coverage. Except with respect to the Limit of Insurance, the coverage afforded applies separately to each insured who is seeking coverage or against whom a claim or "suit" is brought. Copyright, Insurance Services Office, Inc., 1996

The definition of "insured" refers to the "who is an insured" provision of the applicable coverage. Except with respect to the coverage part's limit of insurance, coverage applies separately to each insured seeking coverage or against whom a claim or suit is brought. The coverage will not pay twice for the same claim. One insured may file suit against another insured and the policy will apply as if each insured were covered by his or her own policy. This is commonly referred to as "severability of interests," "separation of insureds," or "cross-liability coverage." The definition of "insured" refers to the "who is an insured" provision to determine who qualifies as an insured. Since the "who is an insured" provisions in each of the coverage forms vary widely, each coverage form's definition of "insured" will also differ.

"Insured Contract"

H. "Insured contract" means: 1. A lease of premises; 2. A sidetrack agreement; 3. Any easement or license agreement, except in connection with construction or demolition operations on or within 50 feet of a railroad; 4. An obligation, as required by ordinance, to indemnify a municipality, except in connection with work for a municipality;


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5. That part of any other contract or agreement pertaining to your garage business (including an indemnification of a municipality in connection with work performed for a municipality) under which you assume the tort liability of another to pay for "bodily injury" or "property damage" to a third party or organization. Tort liability means a liability that would be imposed by law in the absence of any contract or agreement; 6. An elevator maintenance agreement; 7. That part of any contract or agreement entered into, as part of your garage business, pertaining to the rental or lease, by you or any of your "employees", of any "auto". However, such contract or agreement shall not be considered an "insured contract" to the extent that it obligates you or any of your "employees" to pay "property damage" to any "auto" rented or leased by you or any of your "employees". An "insured contract" does not include that part of any contract or agreement: 1. That indemnifies an architect, engineer or surveyor for injury or damage arising out of: a. Preparing, approving or failing to prepare or approve maps, drawings, opinions, reports, surveys, change orders, designs or specifications; or b. Giving directions or instructions, or failing to give them, if that is the primary cause of the injury or damage. 2. That indemnifies any person or organization for damage by fire to premises rented or loaned to you. 3. That pertains to the loan, lease or rental of an "auto", to you or any of your "employees" if the "auto" is loaned, leased or rented with a driver; or 4. That holds a person or organization engaged in the business of transporting property by "auto" for hire harmless for your use of a covered "auto" over a route or territory that person or organization is authorized to serve by public authority. Copyright, Insurance Services Office, Inc., 1996

The definition of "insured contract" in the garage coverage form is a combination of that found in the BAP and CGL policies. The definition is important in determining the extent of coverage for contractually assumed liability. There is no requirement that a contract be in writing to qualify as an insured contract. Verbal and even implied contracts may come within the scope of the definition. The types of contracts detailed in paragraphs 1, 2, 3, and 6 of this definition—lease of premises, sidetrack agreement, easement, and elevator maintenance agreement—have traditionally been included in the concept of "incidental contracts."


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Any agreement with a firm that services elevators would be an insured contract covered under the garage policy. This is an important provision for garages since the definition of "elevator" probably would include an automobile hoist. Coverage for contractual liability arising out of the types of contracts addressed in paragraphs 4 and 5 became a part of the garage policy in 1987. Paragraph 7 of the definition of "insured contract" deals with automobile rental or lease agreements that the insured garage or its employees enter into as part of the garage business. The agreements referred to in this paragraph are those in which the insured rents or leases from another, not those in which the insured rents or leases to another. These agreements are insured contracts but do not apply to any obligation of the insured to pay for property damage to the rented or leased vehicle itself. The exceptions to the definition of "insured contract" that eliminate coverage for the professional liability of architects, engineers, or surveyors, and indemnification for damage by fire to rented or borrowed premises are specific to the garage policy and not other commercial auto policies. Coverage for fire damage to premises rented or loaned to the named insured is excluded if the named insured is liable solely due to contractual agreement, however coverage would be available for liability that the insured would have in the absence of a contract or agreement. Paragraph 3 exception to the definition of "insured contract" is for the purpose of eliminating from coverage the exposure for contractually assumed liability for lease vehicles when the auto is leased with a driver. When an auto is leased with a driver, the lessor, the owner of the auto, is legally responsible for the operation of the vehicle. Paragraph 4 deals with the use of common carriers, persons or organizations in the business of transporting property for hire. The garage policy affords no auto liability coverage to the dealer for any liability assumed under such a contract.

"Leased Worker"

I. "Leased worker" means a person leased to you by a labor leasing firm under an agreement between you and the labor leasing firm, to perform duties related to the conduct of your business. "Leased worker" does not include a "temporary worker". Copyright, Insurance Services Office, Inc., 1996

The definition of leased worker describes workers typically leased under long-term agreements to perform work for the business entering into the agreement with the employee leasing firm. Since the policy definition of "employee" includes leased workers for purposes of this policy, there is no difference between employees and leased workers (except when the coverage for injury to leased workers endorsement (CA 23 25) is attached).


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"Loss"

J. "Loss" means direct and accidental loss or damage. But for Garagekeepers Coverage only, "loss" also includes any resulting loss of use. Copyright, Insurance Services Office, Inc., 1996

The definition of the word "loss" is included primarily for physical damage and garagekeepers coverage. It means direct and accidental loss or damage. Regarding garagekeepers coverage, the term includes loss of use, a common component of the definition of property damage. Garagekeepers coverage is based on legal liability and loss of use is an accepted component of the claimant's loss.

"Pollutants"

K. "Pollutants" means any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste. Waste includes materials to be recycled, reconditioned or reclaimed. Copyright, Insurance Services Office, Inc., 1996

The definition of "pollutants" is very broad and could include almost anything that causes injury or damage.

"Products"

L. "Products" includes: a. The goods or products you made or sold in a garage business; and b. The providing of or failure to provide warnings or instructions. Copyright, Insurance Services Office, Inc., 1996

The definition of "products" is specific to the garage coverage form. It is not included in the business auto, motor carrier, or truckers forms. The definition is included in this policy because of the policy's combination of auto and general liability coverages. The definition tracks the CGL definition of "your products" in that the term includes the providing of or failing to provide warnings or instructions. The term "products" is the subject to three Section II—liability coverage exclusions, defective products, loss of use, and products recall. The term is broad enough to include


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any type of good or product that is sold in the named insured's garage business. If the insured is engaged in a business that is not necessary or incidental to the garage business, however, the products made or sold in that business are not included in this definition. An insured should attempt to clarify exactly what operations and products are covered under the garage policy.

"Property Damage"

M. "Property damage" means damage to or loss of use of tangible property. Copyright, Insurance Services Office, Inc., 1996

This definition specifies that property damage not only includes damage to tangible property but also the loss of use of tangible property.

"Suit"

N. "Suit" means a civil proceeding in which: 1. Damages because of "bodily injury" or "property damage"; or 2. A "covered pollution cost or expense", to which this insurance applies, are claimed. "Suit" includes: a. An arbitration proceeding in which such damages or "covered pollution costs or expenses" are claimed and to which the "insured" must submit or does submit with our consent; or b. Any other alternative dispute resolution proceeding in which such damages or "covered pollution costs or expenses" are claimed and to which the insured submits with our consent. Copyright, Insurance Services Office, Inc., 1996

The definition of suit includes, in addition to arbitration proceedings, any other alternative dispute resolution proceeding. The policy's liability insuring agreement sets out the insurer's obligation to defend any insured against a suit asking for damages because of bodily injury, property damage, or covered pollution costs or expenses. This clarifies that the insurer's obligations extend to any type of alternative dispute resolution proceeding.

"Temporary Worker"


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O. "Temporary worker" means a person who is furnished to you for a finite time period to support or supplement your work force in special work situations such as "employee" absences, temporary skill shortages and seasonal workloads. Copyright, Insurance Services Office, Inc., 1996

The definition of temporary worker refers to workers furnished to employers for a finite time period, usually for specific temporary needs of the employer. Under the garage policy, temporary workers are not employees.

"Trailer"

P. "Trailer" includes semi-trailer. Copyright, Insurance Services Office, Inc., 1996

The definition of "auto" in the policy means "a land motor vehicle, trailer or semi-trailer." This definition offers a shortened manner of referring to trailers and semi-trailers. With this definition, any time the word is used, there is no question that it includes semi-trailers.

"Work You Performed"

Q. "Work you performed" includes: a. Work that someone performed on your behalf; and b. The providing of or failure to provide warnings or instructions. Copyright, Insurance Services Office, Inc., 1996

The definition of "work you performed" is specific to the garage coverage form. This definition includes the providing of or failure to provide warnings or instructions. The term is also the subject of three exclusions; the work you performed, loss of use, and products recall exclusions in the Section II—liability coverage portion of the garage coverage form. The term "work you performed" is included in the garage coverage form to make it clear that it is not necessary for the named insured to do the actual work for the definition to apply.


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CLOSING COMMON GARAGE INSURANCE COVERAGE GAPS This course identifies several loss exposures that are not automatically covered by a garage insurance policy and explores ways to fill those coverage gaps. These coverage gaps can be eliminated by using the proper policy forms, arranging for the necessary limits, or implementing appropriate contract provisions. Many of the uninsured loss exposures seem obvious, however agents and brokers often fail to recognize and properly arrange coverage for these exposures.

Dealer Exclusions The garage policy provides physical damage coverage on vehicles owned by or consigned to an auto dealer. A typical dealer might be a franchise dealer selling new vehicles for one or more automobile manufacturers. Used car dealers also are eligible for this coverage. The physical damage coverage applies at the location(s) shown in the policy declarations. Several exclusions apply only to auto dealerships; which do not apply to other types of garage insureds. New Locations. Should an insured dealer begin using a new, unnamed location, the policy automatically extends coverage to the new location for 45 days, subject to a limit shown on the declarations page of the policy. This limit can be any amount negotiated between the parties. Since there is no premium charge associated with increasing this limit, the limit should be adequate to cover the typical exposures for the auto dealer. Transit. The garage form also covers autos in transit, subject to a limit indicated on the declarations page. As with the unnamed storage locations, there is no additional premium charged for increasing the limit. Since proper coverage is available without a premium charge, policies should be written with limits that adequately cover the client's off-premises transit exposure. Collision. Usually, collision coverage applies to vehicles being driven anywhere within the covered territory. However, with respect to vehicles being picked up or delivered, collision coverage is limited to a 50-mile radius.

COLLISION RADIUS LIMITATION 4. If your business is shown in the Declarations as an "auto" dealership, we will not pay for: c. Under the Collision Coverage, to any covered "auto" while being driven or transported from the point of purchase or distribution to its destination if such points are more than 50 road miles apart. Garage Coverage Form, CA 00 05 07 97, Copyright, Insurance Services Office, Inc., 1996


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The Dealer's Driveaway Collision Coverage endorsement (CA 25 02) can be used to remove the collision radius limitation for dealers that pick up or deliver vehicles beyond a 50-mile radius. This exposure typically arises in dealer trade and used car transactions.

DRIVEAWAY COLLISION COVERAGE The exclusion relating to collision "loss" to covered "autos" driven or transported more than fifty road miles from the point of purchase or distribution to the destination does not apply, provided that: 1. You must include in your regular monthly or quarterly reports a statement of the points of origin, the destination and the factory price of each of these covered "autos." 2. If on the date of your last report the total value of these covered "autos" driven or transported during the period the report covers, exceeds what you reported, we will pay only a percentage of what we would otherwise be obligated to pay. We will determine this percentage by dividing the total value reported by the total value you actually had on the date of your last report. Dealer's Driveaway Collision Coverage, CA 25 02 12 93, Copyright, Insurance Services Office, Inc., 1993

The dealer must accurately report the values and places from which autos were picked up or delivered. A 100 percent coinsurance clause applies to the dealer’s driveway collision coverage, so any understatement of values will result in the claim payment being reduced by the same percentage as the values reported were understated.

Damage to Products The garage policy excludes coverage for damage to the insured's own product caused by a defect in that product after a customer has taken possession of the product.

DEFECTIVE PRODUCT EXCLUSION This insurance does not apply to any of the following ... "Property damage" to any of your "products," if caused by a defect existing in your "products" or any part of your "products", at the time it was transferred to another. Garage Coverage Form, CA 00 05 07 97, Copyright, Insurance Services Office, Inc., 1996


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While many losses arising from the self-destruction of the insured's product are relatively small, some may be quite substantial. This exposure can be covered by adding the Broad Form Products Coverage endorsement (CA 25 01).

BROAD FORM PRODUCTS COVERAGE ENDORSEMENT The DEFECTIVE PRODUCTS Exclusion does not apply. However, subject to the Each "Accident" Limit of Insurance—"Garage Operations"—Other Than Covered "Autos", the coverage only applies to that amount of "property damage" to your "products" that exceeds $250 for any one "accident". Broad Form Products Coverage, CA 25 01 12 93, Copyright, Insurance Services Office, Inc., 1993

False Pretense A loss suffered by a dealer fraudulently induced to part with title to an auto is not covered by the garage coverage form. The false pretense exclusion specifically eliminates coverage for "trick or device losses," as these claims are often called. Coverage can be added to the policy with the False Pretense Coverage endorsement (CA 25 03).

FALSE PRETENSE COVERAGE ENDORSEMENT Any "auto" you have acquired is a covered "auto" under False Pretense Coverage ... We will pay for "loss" to a covered "auto" under: False Pretense Coverage Caused by: a. Someone causing you to voluntarily part with the covered "auto" by trick, scheme or under false pretense. b. Your acquiring an "auto" from a seller who did not have legal title. False Pretense Coverage, CA 25 03 07 97, Copyright, Insurance Services Office, Inc., 1996

Broadened Coverage—Garages


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The Broadened Coverage—Garages endorsement (CA 25 14) adds eight important coverage extensions to the garage policy and should probably be added to any garage policy written. The eight coverage extensions are listed below.

ADDITIONAL COVERAGES PROVIDED BY ENDORSEMENT CA 25 14 • Personal Injury and Advertising Injury • Host Liquor Liability • Fire Legal Liability • Incidental Medical Malpractice • Nonowned Watercraft • Additional Persons Insured • Automatic ... Newly Acquired Businesses (90 days) • Limited Worldwide Liability

All Risk Legal Liability Coverage The Broadened Coverages—Garages endorsement includes an extension for fire legal liability coverage. It covers the insured for liability arising from damage to real estate in the insured's care, custody, and control if the damage results from the peril of fire, but not from other perils. Coverage for damage by such perils as explosion, vehicle damage, water damage, and many others may be provided under a separate policy, the Property Legal Liability Coverage form (CP 00 40) and an appropriate causes of loss form. All risk coverage can be effected by attaching the Special Causes of Loss form (CP 10 30).

Customer Coverage Garage insurance protects the insured garage in the situation of a customer driving a dealer-owned vehicle(s). There are some important considerations regarding whether the garage policy will protect the customer while the customer is driving the dealer's vehicle. Unless coverage is activated on the declarations page, the garage insurance will not provide any coverage for the customer who has auto insurance with limits at or above those prescribed by the state's financial responsibility law. (These limitations do not apply to garage risks such as truck stops, body shops, service stations, and towing operations.)

ELIMINATION OF CUSTOMER COVERAGE 1. WHO IS AN INSURED a. The following are "insureds" for covered "autos": (2) Anyone else while using with your permission a covered "auto" you own, hire or borrow except:


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(d) Your customers, if your business is shown in the Declarations as an "auto" dealership. However, if a customer of yours:


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(i) Has no other available insurance (whether primary, excess or contingent), they are an "insured" but only up to the compulsory or financial responsibility law limits where the covered "auto" is principally garaged. Garage Coverage Form, CA 00 05 07 97, Copyright, Insurance Services Office, Inc., 1996

In the unlikely event the customer's PAP does not respond with the higher limit, garage insurance will meet the financial responsibility limits at the location where the accident occurred. Complete auto liability coverage can be provided on behalf of customers while driving an insured dealer's autos. For an additional charge of 25 percent of the liability coverage premium, the garage policy can be amended to provide the entire garage limits to the customer.

Drive Other Car Coverage To provide non-business-related auto coverage for persons furnished autos by the dealership, add the Drive Other Car Coverage endorsement (CA 99 10). Liability, physical damage, medical payments, uninsured, and underinsured motorist coverages can be provided by this endorsement. Coverage is provided only for those named in the endorsement.

DRIVE OTHER CAR COVERAGE EXCERPTS A. This endorsement changes only those coverages where a premium is shown in the Schedule. B. CHANGES IN LIABILITY COVERAGE 1. Any "auto" you don't own, hire or borrow is a covered "auto" for LIABILITY COVERAGE while being used by any individual named in the Schedule or by his or her spouse while a resident of the same household except: a. Any "auto" owned by that individual or by any member of his or her household. b. Any "auto" used by that individual or his or her spouse while working in a business of selling, servicing, repairing or parking "autos". 2. The following is added to WHO IS AN INSURED: Any individual named in the Schedule and his or her spouse, while a resident of the same household, are "insureds" while using any covered "auto" described in paragraph B.1. of this endorsement.


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C. CHANGES IN AUTO MEDICAL PAYMENTS AND UNINSURED AND UNDERINSURED MOTORISTS COVERAGES The following is added to WHO IS AN INSURED ... D. CHANGES IN PHYSICAL DAMAGE COVERAGE Any private passenger type "auto" you don't own, hire or borrow is a covered "auto" while in the care, custody or control of any individual named in the Schedule or his or her spouse while a resident of the same household except: 1. Any "auto" owned by that individual or by any member of his or her household. 2. Any "auto" used by that individual or his or her spouse while working in a business of selling, servicing, repairing or parking "autos". Drive Other Car Coverage, CA 99 10, Copyright, Insurance Services Office, Inc., 1996

Conclusion

Many optional coverages are available within a garage policy. Some must be added by endorsement while others are triggered by an indication on the declarations page. Most of the options can be provided at no charge or for a modest cost. These optional coverages should be discussed with every garage policy insured. Only by providing an insured with the proper information can they make appropriate coverage decisions.


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INDEX

Accident ............... 39, 40, 61, 68, 70, 82

ACV .................................................... 57

Advertising ................................... 39, 83

Advertising injury .............................. 39

Aggregate .......................................... 39

Agreement ............................... 19, 42, 49

Aircraft ................................................ 35

Any Auto .................................. 9, 10, 11

Appraisal ............................................. 60

Audit ................................................... 67

Auto.... 4, 6, 9, 10, 11, 14, 53, 56, 57, 58,

66, 70

Auto dealers ........................................ 4

Automatic ..................................... 16, 83

Bailee .................................................. 65

Bankruptcy .......................................... 64

BAP 7, 17, 20, 22, 26, 27, 30, 34, 53, 54,

60, 68, 70, 75

Bodily injury .. 26, 27, 29, 30, 33, 37, 38,

67, 70

Breakage ............................................. 51

Broad ............................................ 39, 82

Broad form products coverage ....... 39

Business .............................................. 14

Class I .................................................. 4

Class II ................................................. 4

Collision ............... 42, 50, 51, 55, 80, 81

Commercial ....................................... 22

Concealment ....................................... 64

Conditions ................................ 6, 60, 63

Contamination ................................... 31

Contract ............................................... 74

Contractual .............................. 26, 45, 46

Conversion .......................................... 46

Copyright .. 7, 11, 12, 13, 14, 15, 17, 18,

19, 20, 22, 23, 25, 26, 27, 28, 29, 30,

31, 34, 35, 36, 37, 38, 40, 41, 43, 44,

45, 46, 47, 48, 49, 50, 51, 52, 53, 54,

55, 56, 57, 58, 59, 60, 61, 62, 63, 64,

65, 66, 67, 68, 69, 70, 72, 73, 74, 75,

76, 77, 78, 79, 80, 81, 82, 84, 85

Coverage C ................................. 47, 82

Coverages ............. 9, 10, 15, 63, 65, 83

Covered pollution cost or expense 67,

71

Custody ............................................... 29

Damages ......................... 37, 39, 40, 78

Dealers . 4, 5, 6, 9, 13, 14, 15, 51, 56, 57,

58, 59

Deductible ......................... 41, 47, 58, 59

Duties .................................................. 61

Employee leasing ............................. 72

Employment ................................ 27, 28

Employment-related practices ........ 28

Endorsement ................................. 6, 11

Equipment ............................... 17, 47, 54

Exceptions ......................................... 22

Excess ................................................ 66

Exclusions .... 24, 26, 45, 46, 52, 54, 55,

56, 80

Executive officer ......................... 23, 44

Executive officers ....................... 23, 44

False pretense .................................. 55

Fire .................................... 39, 42, 50, 83

Flood................................................... 50

Forms ........................................... 66, 69

Franchised ................................... 4, 5, 6

Fraud ................................................... 64

Garage .. 6, 7, 14, 15, 19, 20, 30, 33, 39,

40, 42, 68, 73, 80, 81, 82, 83, 84

Garage operations ........................... 73

Garagekeepers .. 5, 6, 9, 10, 42, 43, 44,

45, 47, 76, 77

Garages ................................. 46, 82, 83

Glass breakage................................. 51

Hired ................................... 9, 10, 14, 66

Incidental ..................................... 39, 83

Increase ............................................. 25

Insurance Services Office .... 7, 11, 12,

13, 14, 15, 17, 18, 19, 20, 22, 23, 25,

26, 27, 28, 29, 30, 31, 34, 35, 36, 37,

38, 40, 41, 43, 44, 45, 46, 47, 48, 49,

50, 51, 52, 53, 54, 55, 56, 57, 58, 59,

60, 61, 62, 63, 64, 65, 66, 67, 68, 69,

70, 72, 73, 74, 75, 76, 77, 78, 79, 80,

81, 82, 84, 85


Upd 08252015.doc 8/25/2015


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Insured ....... 7, 14, 21, 22, 44, 67, 74, 83

Insurer ........................................... 62, 69

ISO .................................................... 5, 6

Law ..................................................... 13

Leased worker .................................. 76

Legal ............................................. 62, 83

Liability 5, 6, 7, 9, 10, 12, 13, 17, 19, 20,

25, 26, 27, 30, 38, 39, 40, 46, 62, 65,

66, 68, 83, 84

Liberalization ...................................... 65

Limited ................................................ 83

Liquor Liability ............................. 38, 83

Loss ... 18, 31, 36, 42, 46, 47, 50, 51, 52,

55, 58, 60, 61, 63, 76, 83

Manual ............................................... 22

Medical ............................... 9, 10, 40, 83

Nondealer ............................................ 6

Non-dealer....................................... 5, 59

Nonfranchised ................................. 4, 5

Non-owned .................................... 14, 39

Nuclear ........................................... 6, 52

Nuclear Energy Liability Exclusion Endorsement ................................... 6

Occurrence ........................................ 68

Operations . 19, 20, 30, 33, 39, 40, 73, 82

Options ................................................ 63

Our .................................... 19, 20, 42, 66

Out-of-State Coverage ........................ 25

Owned .................... 9, 10, 12, 13, 14, 17

Owned Autos Subject to No-Fault 10,

12

PAP..................................................... 84

Personal injury .................................. 39

Policies ................................................ 69

Pollutants............................................. 77

Pollution ............................ 30, 33, 68, 71

Pollution cleanup .............................. 68

Premises ............................................ 20

Premises-operations ........................ 20

Premium................................... 5, 57, 67

Primary ............................................... 66

Private ................................................. 12

Property damage ...... 29, 35, 36, 77, 81

Racing ........................................... 34, 53

Recovery ............................................. 63

Repair shops ....................................... 6

RV ......................................................... 5

Schedule .......... 6, 13, 14, 15, 57, 84, 85

Section I ................. 9, 19, 42, 73, 77, 79

Section II .......................... 19, 42, 77, 79

Section III ........................................... 42

Section V ................................... 7, 8, 70

Service stations .................................. 6

Specifically Described Autos 9, 10, 13

State..................................................... 25

Storage garages ................................. 6

Subrogation ....................................... 63

Suit ................................................ 61, 78

Symbols ........................... 10, 11, 12, 17

Tapes ........................................... 47, 54

Temporary worker ............................ 78

Termination ....................................... 28

Territory .............................................. 67

Theft ....................................... 42, 46, 50

Tort liability ........................................ 74

Tow truck ............................................. 6

Trailer ............................... 13, 15, 78, 79

Transfer ............................................... 63

Transit ................................................ 80

UM/UIM .......................................... 9, 13

Us ............................................ 62, 63, 69

Used ......................................... 5, 14, 80

War ................................................ 37, 52

Waste ................................................. 77

Watercraft ..................................... 35, 83

We 17, 19, 20, 24, 25, 41, 42, 47, 49, 52,

53, 54, 56, 57, 61, 63, 65, 67, 81, 82

Wear and tear ................................... 56

Windstorm ......................................... 50

Worldwide .......................................... 83

You ........... 15, 17, 21, 22, 36, 44, 79, 81

Your .......... 14, 21, 23, 44, 55, 64, 82, 83

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