1. Coverage

The liability section of the personal auto policy excludes damage to property owned by, rented to, used by, or in the care of the insured. Such coverage is provided under the Personal Auto policy by Part D—coverage for damage to your auto, commonly known as physical damage coverage.

Physical damage coverage pays for direct and accidental loss to the named insured’s covered auto or any nonowned auto against loss caused by:

collision; or

other than collision (sometimes referred to as OTC or comprehensive).

It does not cover any personal property in the vehicle.

Together, these two coverages provide what amounts to open peril coverage for damage to the named insured’s auto. 

The named insured may purchase collision coverage only, other than collision coverage only, or both. Coverage may also vary by car. But only coverages for which a premium is shown in the declarations will apply.

In general, collision is defined as the impact of an auto covered by the policy with another object or vehicle, or the upset of a vehicle.

Other than collision coverage pays almost every other type of direct, accidental loss to the vehicle that is not specifically excluded by the policy. These perils are specifically listed in the policy as being other than collision losses:

Missiles or falling objects


Theft or larceny

Explosion or earthquake


Hail, water, or flood

Malicious mischief or vandalism

Riot or civil commotion

Contact with a bird or animal

Breakage of glass

If glass breakage is caused by collision, the insured has the option of having it treated as a collision loss. 

This eliminates a double deductible when glass breakage and other collision damage occur in the same accident. 

If the named insured has a covered loss in a nonowned auto, the broadest coverage that applies to any of the insured’s covered autos will apply to the nonowned auto. 

A nonowned auto is any private passenger auto, pickup truck, trailer, or van not owned by or available for the regular use of the named insured or a family member, such as a short-term rental car. 

Under physical damage coverage only, a temporary substitute auto is considered a nonowned auto instead of a covered auto.

2. Transportation Expenses

In addition to collision and other than collision coverage, Part D provides transportation expenses coverage. This coverage pays up to $20 per day, to a maximum of $600, for:

transportation expenses incurred by the insured because of physical damage losses to the insureds covered auto; and

loss of use expenses for which the insured becomes legally responsible because of loss to a nonowned auto. 

Transportation expenses will be paid for collision and other than collision losses provided the insured has purchased these coverages.

For transportation expenses arising out of the total theft of the auto, there is a 48-hour waiting period before expenses will be paid. 

Coverage continues until the auto is returned to use or the company pays for its loss.

For other types of losses, there is a 24-hour waiting period. Coverage is limited to the period reasonably required to repair or replace the auto.

3. Exclusions

Part D excludes losses:

to an auto being used as a public or livery conveyance;

due and confined to wear and tear, freezing, mechanical or electrical breakdown, or road damage to tires  (does not apply when the damage results from the total theft of the auto);

caused by war or nuclear perils;

to electronic equipment that reproduces, receives, or transmits audio, visual, or data signals (does not apply to equipment that is permanently installed in the auto);

to tapes, records, disks, and other media used with the electronic equipment described above; 

due to destruction or confiscation by government or civil authorities  (does not apply to the interests of any loss payee in a covered auto);

to a camper body, trailer, or motor home that is not listed in the declarations. This exclusion also applies to cooking, dining, plumbing, and refrigeration facilities used with these items. This exclusion does not apply to

trailers and their facilities and equipment that are not owned by the ——insured, or

trailers, camper bodies, and their facilities and equipment acquired ——during the policy period if coverage is requested within 14 days after acquisition;

to a nonowned auto when used by the named insured or family member without a reasonable belief that he is entitled to do so;

to awnings, cabanas, or equipment designed to create additional living space;

to custom furnishings or equipment in a pickup or van (does not apply to caps, covers, or bedliners on pickup trucks);

to radar or laser detection equipment;

to nonowned autos being used by any person engaged in an auto business;

to nonowned autos being used in any business (does not apply to the use of a private passenger auto or trailer by the named insured or family member);

to any auto being used in a prearranged racing or speed contest; and

to an auto rented by the named insured or a family member if the rental agency is prohibited from recovering from the insured or a family member under the provisions of state law or a rental agreement.

4. Other Provisions

Physical damage losses are reimbursed for actual cash value or the amount needed to repair or replace the property, whichever is less.

 If the insured and the insurance company do not agree on the amount that should be paid, the loss may be appraised. 

If the insurer pays for a loss in money, the payment will include the applicable sales tax for the damaged or stolen property.

The most the policy will pay for loss to a nonowned trailer is $1,500. 

Coverage for electronic equipment that is permanently installed in an area of the car that is not normally used by the manufacturer for this equipment is limited to $1,000.

Collision and other than collision coverage are usually written with a deductible that applies separately to each occurrence.

In the physical damage part of the personal auto policy, the other insurance condition is called other sources of recovery.

 It is essentially the same as the other insurance conditions in Part A and Part B, except that it states that the insurer will pay only its share of the loss if any other source of recovery, not just insurance, applies to the loss.

The no benefit to bailee condition states that a bailee cannot benefit from the insurance policy if a loss occurs to the car while it is in the bailee’s possession. 

Examples of bailees are repair shop owners and employees of parking garages.

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