6 - 1Copyright 2008, The National Underwriter Company Automobile and Recreational Vehicle Insurance  What is it?  Personal auto insurance  Specified basis (make, model and serial number)  Autos owned by individuals other than husband and wife, residing together may be insured by endorsement  Auto leased are considered owned and eligible  Qualifying vehicles  No fewer than 4 wheels  Pickups & vans < 10,000 pounds & not used for transportation or delivery of goods and materials Chapter 6 Risk Management For Financial Planners

6 - 2Copyright 2008, The National Underwriter Company  What is it? (cont'd)  Persons insured  Named insured  Spouse (resident of same household)  Family members (Related by blood, marriage or adoption)  Wards or foster children  What it covers  Insured’s liability for bodily injury or property damage  Medical payments coverage  Uninsured and underinsured motorist  Physical damages  Recreational vehicles  Endorsed onto an auto or homeowners policy Chapter 6 Risk Management For Financial Planners Automobile and Recreational Vehicle Insurance

6 - 3Copyright 2008, The National Underwriter Company  The Auto Policy  Liability  Insurer will pay damages for bodily injury or damages  Insurer will also settle/defense claims or suit  Insurer will pay defense costs in addition to limits of liability  Example  Bodily injury liability of $100,000 per accident, $300,000 per accident and property damage liability of $100,000  Supplemental payments  Up to $250 for bail bonds  Up to $200 per day for loss of earning  Attendance at trial or hearing because of the accident Chapter 6 Risk Management For Financial Planners Automobile and Recreational Vehicle Insurance

6 - 4Copyright 2008, The National Underwriter Company  The Auto Policy (cont'd)  Uninsured and underinsured motorist coverage  Owner of uninsured vehicle must be legally responsible to pay for insured’s damages  Who are the insured’s  You and any family member as stated in the policy  Any other person occupying the vehicle  Derivative insured  Husband of an injured wife / father of an injured child  Underinsured coverage  Defined as motor vehicle or trailer...to which a bodily injury liability bond or policy applies  But it’s limits for bodily injury liability is less than the limit of liability for this coverage  Insurer pays only after limits of liability have been exhausted Chapter 6 Risk Management For Financial Planners Automobile and Recreational Vehicle Insurance

6 - 5Copyright 2008, The National Underwriter Company  The Auto Policy (cont'd)  Medical payments coverage  Insurer will pay reasonable expenses for necessary medical and funeral expenses because of bodily injury caused by an accident  Insured  Named insured or any family member injured while occupying  Pedestrian struck by a motor vehicle  Claims paid within 3 years of accident  Personal injury protection  No Fault  Person injured received compensation for his loss regardless of less Chapter 6 Risk Management For Financial Planners Automobile and Recreational Vehicle Insurance

6 - 6Copyright 2008, The National Underwriter Company  The Auto Policy (cont'd)  Physical damage coverage  Insurer will pay for direct and accidental loss to covered and non-owned auto  Deductible is subtracted from the payment  Non-owned auto  In the custody or being operated by the insured or any family member  Collision  Upset of the names insured covered auto or non-owned auto or the impact with another vehicle or object Chapter 6 Risk Management For Financial Planners Automobile and Recreational Vehicle Insurance

6 - 7Copyright 2008, The National Underwriter Company  The Auto Policy (cont'd)  Other than collision  Losses caused by  Missiles  Earthquake  Falling objects  Vandalism  Fire  Riot  Theft  Contact with a bird or animal  Larceny  Glass breakage  Explosion  Any damage to the covered auto besides collision is covered on an open perils basis Chapter 6 Risk Management For Financial Planners Automobile and Recreational Vehicle Insurance

6 - 8Copyright 2008, The National Underwriter Company  Recreational vehicle coverage  Auto policy will not respond to liability arising out of use of a vehicle having fewer than 4 wheels  Homeowners policies provide limited liability for use of a snowmobile or ATV  No physical damage coverage at all  Coverage for Motorized vehicles from motor-homes to golf carts  Attach as an endorsement to the auto policy Chapter 6 Risk Management For Financial Planners Automobile and Recreational Vehicle Insurance

6 - 9Copyright 2008, The National Underwriter Company  Boat-owners coverage  Homeowners policies provide limited liability and physical damage coverage for water craft  Additional coverage should be discussed with the insurance agent Chapter 6 Risk Management For Financial Planners Automobile and Recreational Vehicle Insurance