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Nonprofit Resources is a wholly owned Subsidiary of Colorado Nonprofit Association |
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Business Auto Policy -3- The previous issues of iNews have discussed coverage under a Business Auto policy. To review that information or any of the previous issues, please click here. Endorsements to a Business Auto Policy Uninsured motorist/Underinsured Motorist: This endorsement provides protection to the nonprofit if it is involved with another auto that either is not insured or is underinsured. This is an important additional coverage to include on your Business Auto policy. The allowable limits and coverage range from $25,000 to $1 Million. Medical Payments: This endorsement pays for medical expenses incurred by the insured who sustains bodily injury caused by an accident. A volunteer driving a nonprofit’s vehicle could benefit from this coverage. Excluded from this coverage is bodily injury to an employee. That employee would be insured for on-the-job injuries under a workers’ compensation policy. Unlike liability coverage, where the nonprofit must be legally liable before the policy will respond, medical payments coverage does not require the nonprofit to be liable before the policy will respond. This coverage is sometimes called “goodwill” coverage. The typical amount of coverage is $5,000 but higher amounts may be purchased. Rental Reimbursement: This endorsement pays for the rental of an auto because of loss to a covered auto. Typically, the coverage will pay for up to 30 days at a predetermined limit per day while the covered auto is being repaired or replaced. Hired Auto Physical Damage: This endorsement provides physical damage coverage when the nonprofit rents a vehicle for use at the organization. Generally, the insurance company will require that you have owned autos insured under the policy and have purchased physical damage coverage for those vehicles before they will allow you to add this endorsement. Determine if your individual employees will be covered under this endorsement if they rent the vehicle in their name rather than the name of the organization. Typical Business Auto Policy Claims The most common claim is backing into something. The most common injury accident is the rear-ending accident. More serious accidents occur at intersections, while making left turns, and as a result of leaving the roadway. Examples:
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