7.2 Exclusions and Part E - Duties After an Accident

Part D Exclusions

Part D would be unprofitable and uninsurable without exclusions. The PAP lists exclusions that remove uninsurable, catastrophic, or non-fortuitous exposures. The most heavily tested ones:

• Wear and tear, freezing, mechanical or electrical breakdown, road damage to tires - maintenance items, not fortuitous losses. (Exception: these apply if the loss results from a covered theft.)
• Radioactive contamination and war - catastrophic, uninsurable.
• Public/livery conveyance - using the auto to carry persons or property for a fee (e.g., taxi). A 2018-era endorsement and the transportation-network exclusion also bar coverage while logged into a ride-share app.
• Custom equipment and electronic equipment - non-factory sound/electronics and custom furnishings are excluded beyond a small built-in limit, requiring an endorsement.
• Government destruction or confiscation, and loss to a non-owned auto used without a reasonable belief of entitlement.
• Racing - loss while the auto is in or practicing for any organized racing or speed contest.

Limit of Liability Refinements

Part D caps the insurer's payment in two further ways tested on the national portion:

Diminution in value is a frequent trap: even a properly repaired car worth less on resale gets no extra payment under the unendorsed PAP.

Part E - Duties After an Accident or Loss

Part E is a condition, not a coverage. It states what an insured must do for the company to provide coverage under the policy. Because these are conditions precedent, a material failure can void an otherwise valid claim. The general duties apply to any claim under any Part:

1. Prompt notice - notify the insurer how, when, and where the accident or loss happened, plus names and addresses of injured persons and witnesses.
2. Cooperate with the insurer in investigation, settlement, or defense.
3. Forward legal papers - send copies of any notice or legal document received in connection with the loss.
4. Submit to exams - submit, as often as reasonably required, to physical exams by company-chosen physicians and to examinations under oath (EUO).
5. Authorize the insurer to obtain medical and other relevant records.
6. Submit proof of loss when required.

Additional Duties for Physical Damage Claims

When the insured wants payment under Part D specifically, two more duties attach:

• Take reasonable steps to protect the auto from further loss - e.g., cover a broken window or move the vehicle. The insurer will pay reasonable expenses incurred to do so.
• Permit the insurer to inspect and appraise the damaged property before its repair or disposal.

A UM/UIM or theft claim adds duties too: promptly notify the police when a covered auto is stolen, and (for a hit-and-run UM claim) report the accident to police within a stated time. Failure to protect the vehicle, or repairing/disposing of it before inspection, gives the insurer grounds to reduce or deny the claim.

Trap: Notice and cooperation are conditions precedent. An insured who settles privately, signs a release, or disposes of the wreck without consent may forfeit coverage even though the loss itself was covered.

Stacking, Stated Notice, and the Cooperation Trap

When the same insurer issues two or more PAP policies to the insured, Part F caps recovery at the highest single limit - the insured cannot stack the insurer's own policies for one loss. Notice and cooperation are conditions precedent: an insured who repairs or disposes of a damaged auto before the insurer inspects, or who settles privately and signs a release, can forfeit an otherwise valid claim.

Trap: Diminution in value (lost resale value after a quality repair) is excluded under the unendorsed PAP - even a perfectly repaired car gets no extra payment for stigma.

Ride-Share, Custom Equipment, and the Public-Conveyance Gap

Three exclusion areas dominate Part D questions. The public/livery conveyance exclusion and the related transportation-network language bar physical-damage coverage while the auto is used to carry persons or property for a fee or while logged into a ride-share app - a ride-share endorsement is required. Custom/non-factory electronic and sound equipment is limited to a small built-in cap unless scheduled.

Trap: A driver who totals a car while the ride-share app is on has no Part D coverage under the unendorsed PAP - a fact pattern the exam (and real life) loves. The personal policy resumes only when the driver is off the platform.