PP 03 06─EXTENDED NON-OWNED COVERAGE - VEHICLES FURNISHED OR AVAILABLE FOR REGULAR USE

(September, 2018)

The Insurance Services Office’s (ISO) basic Personal Auto Policy (PAP) covers exposure to loss that is related to owning and operating certain types of vehicles. The unendorsed PAP also contains limited protection for operating a non-owned auto, pickup, van or SUV. However, coverage for non-owned vehicles available for an insured’s regular use is excluded.

The PP 03 06–Extended Non-Owned Coverage - Vehicles Furnished or Available for Regular Use provides coverage for those excluded situations.

The Schedule

The endorsement includes a schedule for listing the name of the insured individual and the premium amounts for extended non-owned liability and medical payments coverages. When the box is checked, the coverage can extend to the spouse and other family members of the individual named in the schedule.

COVERAGE ANALYSIS

There are persons who own a vehicle but also need liability and medical payments coverage for operating vehicles available for their use but that they do not own.

I. Extended Non-Owned Coverage

This section points out that the endorsement won't respond to losses involving vehicles owned by the named insured, or by a family member. Neither will the form handle losses involving vehicles that are substitutes for autos owned by the named insured and members of his or her insured household.

Example: Jason’s daughter gets a job as an intern in a nearby town. He lets her use his car for commuting. Jason’s friend tells him he has an extra car that no one in his family uses. He gives Jason a set of keys and tells him he’s free to use it anytime. Jason frequently uses his friend’s car for errands, nearly daily. The friend’s car would qualify for coverage under this endorsement.

II. Part A - Liability Coverage

The form makes exclusions B.2.b. inapplicable to the non-owned coverage provided by the form.

This section of the form then states that it will cover the liability for individual named in the schedule when operating a vehicle that:

· Does not meet the policy definition of "your covered auto"

· That is made available for the individual named in the endorsement’s regular use

Part B - Medical Payments Coverage

The form, for purposes of non-owned coverage, makes PAP exclusion 5.b. inapplicable to the individual named in the endorsement. The result is that coverage for medical treatment is available to the individual named in the endorsement who is injured while occupying or being struck by a car.

Rating

A flat rate applies to the liability and/or Medical Payments coverages that appear in the endorsement’s schedule. The actual charges vary by company.

This form no longer contains reference that it must be attached to a Change of Endorsement form .(09 18 Change)