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From the Editor
"Ask an Expert" Briefs
Autos vs. Mobile Equipment: Revisiting the 2004 CGL
An insurer insists that an ATV, just because it has to have a 'recreational vehicle' registration, is considered an auto under the new CGL definition. In the subject state, ATVs are not subject to compulsory insurance and cannot be operated on a public way other than crossing from one side to the other. However, they are required to be registered as an RV through the Inland Fish & Wildlife Department. So, what is an ATV, an auto or mobile equipment and where should they be insured and covered, the BAP or CGL?
CGL...No, BAP...No, CGL...No, BAP...Well, Which Is It?
An insured manufactures a product that is being transported by another party on a flatbed trailer. There's an accident which results in the product causing BI to the driver of another vehicle. The insured has CGL, but no products/completed operations coverage...he also has Hired and NonOwned Auto coverage. The question at hand though, is 'Could his CGL provide any coverage for this 'auto' claim? Let's take a look at this 'Ask an Expert' question....
Is It an Auto or Is It Mobile Equipment?
One of the most debated commercial lines issues is whether or not a vehicle is an 'auto' or 'mobile equipment.' When you carefully read the policy definitions, it's amazing how many vehicles fit the definition of 'mobile equipment,' even vehicles licensed and used on public highways. In fact, it's possible that a vehicle could be an 'auto' under one set of circumstances and 'mobile equipment' under another. In this article, we'll look at an example of this debate.
Is Theft "Property Damage" Under a CGL Policy?
Property was stolen from a guest's auto in the insured hotel's self-parking garage. The guest made a negligence claim against the hotel. The adjuster has denied the claim on the basis that, under state law, theft is not included in the definition of 'property damage.' If the guest sues, the adjuster says no coverage, no defense. True or false?
Loading and Unloading...CGL or BAP?
The BAP covers loading and unloading of a vehicle if done by hand, hand truck, or a mechanical device attached to the auto. The CGL policy picks up the exposure if property is moved by an unattached mechanical device other than a hand truck. So, the question is, what is a 'hand truck'?
Mobile Equipment vs. Autos in the 2004 CGL
The major change in the new 2004 CGL policy is the redefinition of mobile equipment subject to state motor vehicle laws as autos. In the past, such vehicles have been handled by endorsement under the CGL policy, but now will have to be covered under the Business Auto Policy using at least two additional endorsements. And that's just the beginning of what has the potential to be a tidal wave of coverage gaps and E&O claims.
The CGL and Trailers
A local community nonprofit organization is planning their annual festival. They always rent a large, 28-foot flatbed trailer to use as a stage for the bands and speakers. The organization’s event coordinator said that their former agent told them that any injuries involving the stage would be covered by their CGL policy because the trailer was not attached to a vehicle and therefore would be mobile equipment. Do you agree?
When Are "Completed Operations" Completed?
The CGL policy usually covers both on-going and completed operations. However, at what point is an operation completed? This question has particular significance when the business is involved in some sort of periodic service contract.
Why the BAP and CGL Should Be Written by the Same Insurer
A tree trimmer has his CGL policy with one insurer and his BAP policy with another one. There is an accident involving his bucket truck so, of course, each insurer is pointing at the other one for coverage. This and other situations illustrate why it is usually a good idea to insure both policies with one carrier.
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