12.1 Business Auto Coverage Form and Covered Auto Symbols

The Business Auto Coverage Form

The Business Auto Coverage Form (BACF), ISO form CA 00 01, is the standard contract used to insure cars, trucks, vans, and trailers used in a business. It is the commercial counterpart of the Personal Auto Policy (PAP), but it solves a problem the PAP never faces: a business may own zero vehicles or five hundred, and may also rent and borrow autos.

Rather than schedule every vehicle by coverage, the BACF uses covered-auto designation symbols to describe whole categories of autos. The form combines with the Common Policy Declarations, the Common Policy Conditions (IL 00 17), and the Business Auto Declarations to make a complete policy.

How the Form Activates Coverage

The BACF is modular. A coverage exists only when BOTH a symbol and a limit are entered on the declarations next to that coverage. The major sections are:

The Nine Covered-Auto Symbols

Each coverage line carries its own symbol, so liability is usually written far broader than physical damage.

Exam trap: Symbol 1 is the ONLY symbol that automatically pulls in hired and non-owned exposure. A risk written Symbol 2 has a gap for rentals (needs 8) and for employee cars (needs 9). Choosing Symbol 7 means coverage applies to nothing not on the schedule.

Which Symbols Go With Which Coverage

A core distinction the exam tests relentlessly: you cannot insure your own property (physical damage) on autos you do not own.

• Liability may be written on any symbol, but is normally Symbol 1 so owned, hired, and non-owned exposures are all covered.
• Physical Damage may only be written on Symbols 2, 3, 4, or 7 — never 1, 8, or 9, because the insured has no insurable interest in non-owned autos. Hired-auto physical damage is added by endorsement (CA 99 54 or coverage extension) using the hired-auto symbol approach, NOT Symbol 1.
• Medical Payments / UM / PIP typically use Symbol 1, 2, or the relevant state symbol (5 or 6).

The Newly Acquired Auto Rule

When a business buys an additional vehicle mid-term, whether it is automatically covered depends on the symbol:

• Symbols 1, 2, 3, 4 — coverage is automatic with NO reporting needed for liability, because these symbols describe categories that the new auto falls into. For physical damage there is a 30-day automatic window for newly acquired autos, after which the insurer must be notified to continue coverage.
• Symbol 7 (specifically described autos) — a new auto is covered ONLY if (a) the insurer already insures all the insured's autos, OR (b) the new auto replaces a scheduled auto, AND the insured asks to add it within 30 days. Miss the 30 days and there is no coverage.

Worked example: A landscaper insured on Symbol 7 (three trucks scheduled) buys a fourth truck on day 1. The insurer covers all owned autos, so the new truck has automatic liability and physical damage for 30 days. If the insured does not report it by day 30, coverage on the fourth truck lapses.

Rating Basis

Commercial auto is fleet-rated when the insured owns nine or more self-propelled vehicles, blending the whole fleet's loss experience; fewer than nine power units are non-fleet (schedule) rated per vehicle. The premium at inception is a deposit premium, and many BACFs are auditable because vehicles are added and deleted mid-term.

Definitions That Drive Coverage

Section V definitions decide whether the form even applies. An auto is a land motor vehicle, trailer, or semitrailer designed for travel on public roads, but it does NOT include mobile equipment (bulldozers, forklifts, cranes not designed for road use) — that exposure belongs to general liability unless the equipment is subject to motor vehicle registration. An accident includes continuous or repeated exposure to the same harmful conditions. Misclassifying mobile equipment as an auto (or vice versa) is a classic exam trap because it shifts the loss to a different policy.

BACF vs. Personal Auto Policy