Pathway Insurance

If you Violate a Car Insurance Exclusion…

You just might be Floating up the Creek without a Paddle.

(That means the insurance company probably isn’t going to pay the claim)

Keep in mind that car insurance EXCLUSIONS can vary by insurance company and the state in which you reside plus one other factor: Court decisions.  Court’s in different states can come to different conclusions in their interpretation of EXCLUSIONS.  It’s always a good idea to make sure that you read your policy for the specific exclusions applicable to your individual policy.

Let’s review a few common EXCLUSIONS that sometimes are violated by policyholders intentionally or because they simply did not know.  (Not all Exclusions are listed)

EXCLUSIONS – READ THE FOLLOWING EXCLUSIONS CAREFULLY. IF AN EXCLUSION APPLIES, COVERAGE WILL NOT BE AFFORDED UNDER THIS PART.

To any vehicle while being used to carry persons or property for compensation or a fee, including, but not limited to, pickup or delivery of magazines, newspapers, food, or any other products. This exclusion does not apply to shared expense car pools.

This particular exclusion was the reason why the man named “Joe” in our previous post had his claim denied.  Joe was using his vehicle to deliver pizzas, he caused an accident and his insurance company refused to pay for the damage to his vehicle or the other party’s vehicle.

This exclusion could mean that coverage may not be available in the event you use your vehicle for any business activity where you are compensated for that activity.  So if you deliver newspapers, pizza, food of any type, medical supplies, package delivery you may have no coverage under your personal auto policy for accidents or injuries under this exclusion. 

How about if you transport people in your personal automobile as part of your job duties?  Let’s assume you are a social worker, child care worker, or work at a group home transporting your clients to various destinations in your personal automobile? Again the same situation may apply.

Another car insurance EXCLUSION: 

Bodily injury or property damage resulting from, or sustained during practice or preparation for:  Any pre-arranged or organized racing, stunting, speed, or demolition contest or activity; or any driving activity conducted on a permanent or temporary racetrack or racecourse;

What no coverage for drag racing at the local track?  Nope.

Another car insurance EXCLUSION:

Bodily injury or property damage arising out of the use of a covered auto while leased or rented to others or given in exchange for any compensation.

What you mean I can’t open up my own buy here pay here lot and insure the vehicles I sell on my personal auto policy?  Nope.

Another car insurance EXCLUSION:

Bodily injury or property damage caused by, or reasonably expected to result from a criminal act or omission of that insured person. This exclusion applies regardless of whether that insured person is actually charged with, or convicted of, a crime.

Road rage anyone?

As I mentioned previously exclusions may vary from company to company, and the interpretation of those exclusions by court action have been affirmed in one state, but rejected in another. We have briefly considered only a few typical exclusions contained within the personal auto policy.  Take time to read all of the exclusions in your policy.

This entry was posted on Sunday, August 23rd, 2009 at 12:55 PM and is filed under Car Insurance Exclusions, Insurance Coverage. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.