Describe 4 types of vehicle that are considered an automobile for those purpose of coverage under the MSPF 1.
a) Described automobile:
- Automobile specifically described in the policy.
- The certificate of insurance shows which coverages the insured has purchased for each described automobile.
b) Newly Acquired Automobile:
When an insured purchases an additional or replacement automobile, coverage is automatically extended to it, subject to certain conditions.
- - The insured must notify the insurer within 14 days of taking possession of the newly acquired automobile. Which gives the
- insured time to have the change to their policy properly recorded.
- - However, if an insured has other valid insurance on the newly acquired automobile or if the same insurer does not insure all
- automobiles owned by the insured, coverage does not extend to the newly acquired automobile. Also the insured must be engaged in the business of selling automobiles.
- - 14 days of coverage are automatic but now free. Once notified, the insurer will issue an endorsement charging a premium from
- the date the insured took possession of the new automobile.
- - If an insured has insurance for more than 1
- automobile, only coverages that are on all insured automobiles extend to the new automobile.
c) Temporary substitute automobile:
- - Thus, if an insured already has 2 automobiles insured, 1 with collision and the other without, there would be no collision on
- the newly acquired automobile. Similarly if the existing insured automobiles have different deductibles, then the higher deductible applies to the newly acquired automobile.
Is an automobile that is not owned by the insured or anyone living in the insured’s household, but that being used as a temporary substitute for a described automobile that cannot be used because of its breakdown, repair, servicing, loss, destruction or sale.
- 3rd party coverage and Accident Benefits are extended to temporary substitute automobiles as defined by this provision
- - Coverage for physical damage to temporary substitute automobiles is given by the Additional Agreements of Section C(Loss or Damage to Insured Automobile), which cover the insured’s legal liability for damage to
- temporary substitute automobiles
- Automobile owner’s policy always applies 1st when the insured automobile is being operated with consent.
- However, the policy of the driver of a temporary substitute automobile will respond – rather than, or in addition to, the owner’s policy – if the temporary substitute automobile is uninsured, or if the owner’s limit of liability under Third Party Liability is insufficient to pay a judgment or settlement
d) “Borrowed” automobile:
The policy also covers other automobiles not owned by the insured, but driven by the insured or the insured’s spouse who lives with her, subject to certain conditions.
- - The word “borrowed” does not appear in the
- policy wording. It’s used to try and convey the type of automobile for which the policy would provide coverage.
- - The coverage provided by the policy is the same as for temporary substitute automobiles except that no physical damage coverage
- - Any automobile of the private passenger or
- station wagon type, other than the described automobile, is covered while personally driven by the insured or by the insured’s spouse who lives in the same dwelling, provided that:
- a) The described automobile is of the private
- passenger or station wagon type;
- The insured is an individual, or the insureds
- are spouses of each other ;
- c) The automobile is not being driven by the
- insured or the insured’s spouse in connection with a garage business;
- d) The automobile is not owned or regularly or frequently used by the insured or by any person or persons residing in the same
- dwelling premises as the insured;
- e) The automobile is not owned, hired, or leased by an employer of the insured or by an employer of any person or persons residing
- in the same dwelling premises as the insured; and
- f) The automobile is not used for carrying
- passengers for compensation or hire or for commercial delivery.
- If the insured is a corporation, unincorporated association, or registered co-partnership, the borrowed automobile coverage applies to an employee for whose regular use the insured company automobile is furnished, or to the employee’s spouse who reside in the same dwelling premises as the employee.
is more specific. Temporary substitute or burrowed automobiles used for more than 30 days are not covered, even if the loss occurs within the 30 days.
MSPF 1 gives unlimited permission to the insured to pull trailers; it does not differentiate between owned or non-owned trailers.
- - Third Party Liability coverage and Accident
- Benefits will apply to any trailer used in connection with the automobile.
- If the insured requires physical damage coverage on an owned trailer, then the insured must list it as a described automobile in policy and purchase appropriate coverage.