7.1 Part D: Coverage for Damage to Your Auto
Key Takeaways
- Part D of ISO form PP 00 01 provides first-party physical damage coverage in two perils: Collision and Other Than Collision (OTC, also called comprehensive).
- Collision = upset of your auto or impact with another vehicle or object; OTC = everything else (fire, theft, glass, flood, hail, animal strike, falling objects, vandalism).
- The insurer's payment is limited to the lesser of the actual cash value (ACV) or the cost to repair or replace, minus the per-loss deductible.
- Transportation Expenses pay a default $20/day up to $600 total (rental and incidental) after a covered OTC theft or any covered loss, subject to waiting periods.
- A hitting-an-animal loss (deer strike) is OTC, not Collision — a frequently tested distinction because OTC often carries a lower or zero deductible.
Part D in the Six-Part Structure
The ISO Personal Auto Policy (form PP 00 01) insures the policyholder's own vehicle for physical damage under Part D – Coverage for Damage to Your Auto. Unlike Part A (liability), which pays third parties, Part D is first-party coverage: it pays the named insured for damage to your covered auto or a non-owned auto regardless of who was at fault. Buying Part D is optional in most states, but a lienholder (the lender financing the car) will contractually require it and be named as a loss payee.
Part D is written as two separate, independently purchased coverages: Collision and Other Than Collision (OTC). Each carries its own deductible and is shown separately on the Declarations page. A policyholder can buy OTC alone, but cannot buy Collision without also carrying OTC.
Collision vs. Other Than Collision
The policy defines Collision as the upset of your covered auto or its impact with another vehicle or object. Everything else that is not collision and is not excluded falls under Other Than Collision (the older term comprehensive is still used in the field).
| Loss event | Collision | Other Than Collision |
|---|---|---|
| Hitting a guardrail or another car | Yes | No |
| Car rolls over (upset) | Yes | No |
| Fire, explosion | No | Yes |
| Theft of the entire vehicle | No | Yes |
| Glass breakage | No | Yes |
| Hail, windstorm, flood, earthquake | No | Yes |
| Striking a bird or animal (deer) | No | Yes |
| Falling objects, missiles | No | Yes |
| Vandalism / malicious mischief | No | Yes |
| Contact with a bird or animal | No | Yes |
Exam trap: A driver who swerves to avoid a deer and hits a tree has a Collision loss (impact with an object). A driver who strikes the deer has an OTC loss. Because OTC deductibles are often lower (or $0 for glass), this distinction changes what the insured pays out of pocket.
How Much the Insurer Pays
The limit of liability under Part D is the lesser of:
- The actual cash value (ACV) of the stolen or damaged property, or
- The amount necessary to repair or replace the property with other property of like kind and quality,
minus the applicable deductible. ACV is generally understood as replacement cost minus depreciation. The PAP is therefore an indemnity contract — it restores the insured to pre-loss financial position, not to a brand-new car.
Worked ACV example
A 2019 sedan is destroyed in a covered collision. Replacement cost of a comparable used vehicle is $24,000; the adjuster applies $9,000 of depreciation, so ACV = $15,000. The Collision deductible is $500.
- ACV: $24,000 − $9,000 = $15,000
- Less deductible: $15,000 − $500 = $14,500 paid
If instead the car were merely dented and the repair estimate were $3,200, the insurer pays the lesser figure (repair cost) less the deductible: $3,200 − $500 = $2,700.
A covered auto with an ACV of $12,000 is damaged in a collision. The repair estimate is $7,500 and the policy carries a $1,000 collision deductible. How much will the insurer pay?
Transportation Expenses and Towing
Part D automatically includes two supplementary coverages at no extra premium for vehicles that carry the relevant physical damage coverage:
- Transportation Expenses: Pays a default $20 per day up to a $600 maximum for temporary transportation (rental car) and for loss-of-use expenses the insured becomes legally responsible for. A waiting period applies: for a theft of your entire covered auto, coverage begins 48 hours after the theft; for any other covered loss, it begins when the auto is inoperable for more than 24 hours. Higher limits (such as $30/$900 or $40/$1,200) can be purchased.
- Towing and Labor (PP 03 03 endorsement): An optional add-on that pays a small per-disablement limit (for example $25, $50, or $75) for towing and on-site labor, but only labor performed at the place of disablement.
Worked transportation example
A covered auto is stolen on Monday at 8 a.m. and recovered, undriveable, the following Monday. Coverage starts 48 hours later (Wednesday 8 a.m.). The insured rents a car for 20 days at $35/day. Part D reimburses $20/day × 20 = $400, capped at $600, so the full $400 is paid; the $15/day difference is the insured's cost unless higher limits were bought.
Under the unendorsed ISO Personal Auto Policy, what is the standard Transportation Expenses limit after a covered loss?
Loss to a Non-Owned Auto and Pair/Set Concepts
Part D extends physical damage coverage to a non-owned auto the named insured or family member is driving (a borrowed or rented car, or a temporary substitute used while a covered auto is out of service). However, the coverage provided is the broadest physical damage coverage on any covered auto on the policy — if no scheduled auto carries Collision, none extends to the borrowed car.
Audio, visual, and data electronic equipment permanently installed by the manufacturer is covered, but custom or after-market equipment may need scheduling. There is no coverage for: loss to a covered auto used as a public or livery conveyance (rideshare delivery), wear and tear, freezing, mechanical breakdown, road damage to tires, or radar/laser detection devices — several of which carry forward into the exclusions section examined next.