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Driving a Dealer Loaner Auto...No PAP Coverage?!

Your insured's auto is at the Cadillac dealer's shop for servicing and he is given a loaner car which he totals to the tune of $37,000 in an at-fault accident. His PAP insurer says his physical damage coverage is excess on nonowned autos though they might be willing to contribute on a pro rata basis since this is a temporary substitute. The dealer's policy pays the damages, then subrogates against your insured by filing a lawsuit. The PAP insurer denies the liability claim under a reservation of rights, citing the exclusion for care, custody, or control. Who's right?

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​127 South Peyton Street
Alexandria VA 22314
​phone: 800.221.7917
fax: 703.683.7556
email: info@iiaba.net

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