3.5 Part D — Coverage for Damage to Your Auto
Key Takeaways
- Part D has two named coverages: Collision (impact with another object or upset) and Other Than Collision / Comprehensive (everything else); hitting an animal is OTC, not Collision
- Named OTC perils include fire, theft, vandalism, falling objects, hail, windstorm, flood, earthquake, glass breakage, and contact with a bird or animal
- Part D pays the LESSER of the auto's actual cash value (ACV) or the cost to repair or replace with like kind and quality, minus the deductible; the ISO PAP has no agreed-value option
- Transportation Expense pays $30/day up to $900 maximum under form PP 00 01 09 18, beginning 48 hours after a covered loss or immediately after theft of the entire auto
- Custom and electronic equipment installed after manufacture is limited to $1,500 unless scheduled; mechanical breakdown, wear and tear, freezing, and diminution in value are excluded
Collision
Collision is the upset (overturning) of your covered auto or its impact with another vehicle or object: rear-ending another car, hitting a tree, guardrail, fence, or pole, a rollover, or backing into a fire hydrant. Collision carries its own deductible, usually higher than the OTC deductible.
Other Than Collision (OTC / Comprehensive)
Other Than Collision (OTC), also called Comprehensive, covers direct and accidental loss to the auto by any cause except collision. The form lists examples:
| OTC Peril | Note |
|---|---|
| Fire | Including fire that follows another cause |
| Theft or larceny | Including parts stolen from the auto |
| Explosion or earthquake | Earthquake IS an OTC peril on auto |
| Windstorm or hail | |
| Flood or rising water | Covered on auto (contrast with homeowners, which excludes flood) |
| Vandalism or malicious mischief | Slashed tires, keyed paint |
| Riot or civil commotion | |
| Contact with a bird or animal | Hitting a deer is OTC, NOT Collision |
| Breakage of glass | May be assigned to Collision if loss is collision-related |
| Falling objects or missiles | Tree limb, rock from an overpass |
Exam tricks: Hitting a deer is OTC, not Collision. Earthquake and flood are covered as OTC on the auto even though both are typically excluded on a homeowners policy.
Limit of Liability
Part D pays the lesser of:
- The actual cash value (ACV) of the property at the time of loss, or
- The amount necessary to repair or replace the property with like kind and quality,
minus the deductible. The ISO PAP has no agreed-value or stated-value option — ACV (replacement cost minus depreciation) governs, which is why a total loss on an older car pays its depreciated market value.
Non-Owned Auto — Broadest Form Applies
When the insured rents or borrows a non-owned auto, Part D extends the broadest physical-damage coverage carried on any vehicle on the Declarations. So if you drop OTC on your second car to save premium, you also weaken the physical-damage protection on a rental car.
Transportation Expenses
Under current form PP 00 01 09 18, the base transportation-expense benefit is:
- $30 per day, $900 maximum (raised from $20/$600 in the 2018 revision).
- Begins 48 hours after a covered Collision or OTC loss that disables the auto.
- Begins immediately after theft of the entire auto (no 48-hour wait).
- Ends when the auto is returned to use or the insurer pays for the loss.
The PP 03 02 endorsement raises these limits (for example, $40/$1,200 or $50/$1,500).
Custom and Electronic Equipment
Custom furnishings and after-market electronic equipment are limited to $1,500 unless specifically scheduled. Factory-installed equipment is treated as part of the auto and is not subject to the sublimit.
Major Exclusions
- Public or livery conveyance use of the covered auto.
- Wear and tear, freezing, mechanical or electrical breakdown, and road damage to tires (unless theft-caused).
- Electronic equipment not permanently installed (portable devices, media).
- Campers, trailers, and motor homes not shown on the Declarations.
- A non-owned auto used without a reasonable belief of entitlement.
- War, nuclear, or radioactive contamination.
- Diminution in value (the lost resale value of a repaired car).
- Loss due to government destruction or confiscation.
- Racing or speed-contest activity.
Worked Example: Total Loss and ACV
A five-year-old sedan with a market value of about $9,000 is destroyed in a covered collision; the insured carries Collision with a $500 deductible. Repair estimates exceed the car's value, so the insurer declares a total loss and pays the actual cash value (ACV) of $9,000 minus the $500 deductible, for a net of $8,500, then takes the salvage. The insured cannot demand the $14,000 it would cost to buy a brand-new model, because the ISO PAP pays ACV, not replacement cost, and offers no agreed-value option.
If the same insured had spent $3,000 on a custom sound system installed after manufacture, only $1,500 of that equipment is covered unless it was specifically scheduled, so the custom-equipment sublimit caps that portion of the claim.
Which Coverage, Which Deductible
Because Collision and OTC usually carry different deductibles, exam items hinge on classifying the peril correctly. Build the reflex with this list:
- Collision: rear-ending a car, hitting a guardrail or pole, rolling the vehicle, backing into a fixed object.
- Other Than Collision (OTC): fire, theft, hail, flood, earthquake, vandalism, falling tree limb, and contact with a bird or animal.
The deer collision is the most-tested trap — striking an animal is OTC, so the lower OTC deductible applies even though the impact feels like a collision. Glass breakage may be assigned to Collision when it occurs as part of a collision loss, otherwise it is OTC. Remember too that flood and earthquake are covered on the auto under OTC even though both are standard exclusions on a homeowners policy, and that mechanical breakdown, wear and tear, freezing, and diminution in value are never covered — these are maintenance and depreciation items the owner bears, not insurable physical-damage perils.
Imani carries Collision with a $500 deductible and Other Than Collision with a $250 deductible. She returns to find that a vandal slashed her tires and, separately, a deer ran head-on into her parked vehicle. Which coverage and deductible applies?
Under a PAP with current ISO transportation-expense limits ($30/day, $900 maximum), a customer's car is stolen, recovered 35 days later, and then needs 10 more days of repairs. The customer rented a car immediately. How much will Part D pay for transportation expense?