7.2 Exclusions and Part E - Duties After an Accident

Part D Exclusions

Physical-damage coverage on the PP 00 01 is broad but excludes losses the underwriting did not contemplate. The exam tests which losses are excluded and which require an endorsement to restore.

• Wear and tear, freezing, mechanical or electrical breakdown, and road damage to tires (unless the loss is the result of a covered theft).
• Radioactive contamination, war, nuclear, and discharge of any nuclear weapon.
• Electronic equipment that reproduces, receives, or transmits audio/visual/data signals not permanently installed (tapes, records, accessories) - limited or excluded; permanently installed equipment is covered.
• Custom furnishings or equipment in a pickup or van unless covered by endorsement.
• Public or livery use (vehicle used as a taxi or for ride-share without the proper endorsement). Coverage while enrolled in a personal vehicle-sharing program is excluded.
• Destruction or confiscation by government or civil authorities; loss to non-owned autos used without a reasonable belief of permission.

Restoring coverage by endorsement

Several exclusions can be bought back. Know these by name:

Towing and Labor is a frequently tested optional coverage: it pays towing and labor only at the place of disablement, not the cost of parts.

Part E: Duties After an Accident or Loss

Part E is a condition - the insured must comply for coverage to apply. The duties run to every part of the policy (A through D). The exam frames these as the steps an insured must follow after a loss.

General duties owed under any coverage:

1. Prompt notice to the insurer of how, when, and where the accident or loss happened, including the names and addresses of injured persons and witnesses.
2. Cooperate with the insurer in the investigation, settlement, or defense of any claim or suit.
3. Send copies of any legal papers, notices, or summons received in connection with the loss.
4. Submit to physical exams and examinations under oath (EUO) at the insurer's request, as often as reasonably required.
5. Authorize the insurer to obtain medical records and other pertinent information.

Additional duties for Medical Payments, UM, and Part D

For Medical Payments (Part B) and Uninsured Motorists (Part C) claims, the insured must submit proof of claim and, for UM, promptly notify police if a hit-and-run is involved and send the insurer copies of the suit papers if the insured sues the at-fault party.

For a Part D (physical damage) loss, the insured has extra duties:

• Take reasonable steps after a loss to protect the covered auto and its equipment from further loss (the insurer pays reasonable expenses to do so).
• Promptly notify police if the covered auto is stolen.
• Permit the insurer to inspect and appraise the damaged property before its repair or disposal.

Failure to meet a material duty (late notice that prejudices the insurer, refusal of an EUO, repairing before inspection) can be grounds to deny the claim.

Other Tested Part D Exclusions and the Right to Appraisal

Beyond the well-known exclusions, the PP 00 01 bars physical-damage coverage for several causes the exam loves:

• Wear and tear, freezing, mechanical or electrical breakdown (except to a covered tire damaged by vandalism or by a covered loss).
• Road damage to tires unless caused by a covered peril.
• Loss to electronic equipment that reproduces sound, pictures, or data unless permanently installed; tapes, records, and discs are excluded.
• Loss to a vehicle used as a public or livery conveyance (ride-share without endorsement) and racing/speed-contest use.
• Government destruction or confiscation and radioactive/war losses.

Appraisal and the Suit Conditions

If the insurer and insured disagree on the amount of a physical-damage loss, either may demand appraisal: each picks an appraiser, the two select an umpire, and agreement of any two binds the amount — but appraisal does not decide coverage. The legal-action condition bars suit against the insurer unless the insured has fully complied with the policy terms, reinforcing why the Part E duties (prompt notice, cooperation, protect the vehicle, submit to exam) are conditions precedent to recovery.

The Named-Driver and Regular-Use Exclusions

Two underwriting exclusions decide many Part E/Part D questions. The named-driver exclusion (where state law permits) removes a specific high-risk household member from all coverage; if that excluded driver causes a loss, no coverage applies even though the vehicle is insured. The regular-use / furnished-vehicle exclusion bars coverage for a non-owned auto furnished or available for the insured's regular use (e.g., a company car or a long-term loaner), pushing those losses onto the vehicle owner's policy.

After a loss, the insured's Part E duties — prompt notice, cooperation, protecting the vehicle from further loss, and submitting to examination under oath and physical exams — operate as conditions; failure to comply that prejudices the insurer can defeat an otherwise valid claim. These exclusions and duties together explain why ownership, permission, and post-loss conduct dominate auto-claim exam stems.