How to decide which general car insurance is best for you

How to indicate which coverages and divisions the insured has purchased with general auto insurance

The applicable rates and advance premium charges are typed in under Item 3 of the declarations opposite the corresponding selections. The advance premium for Division 1 and 2 of coverages A and B is computed by multiplying the appropriate manual rate times the estimated annual payroll. For elevators, a flat dollar premium is charged per elevator. The advance premium for coverages C and D is computed as a percentage of the Division 1 or 2 premiums (whichever the insured selects), using the bodily injury premium as a base for coverage C and the property damage liability premium as a base for coverage D. All these advance premiums are subject to minimum premiums, shown in the automobile casualty manual. It follows, of course, that where no premium has been entered no coverage is granted.
Limits of Liability
The arrangement of spaces and the accompanying wording provided to indicate the limits of the company’s liability are the same as in the BAP so far as coverages A, B, and C are concerned. And the provision for coverage D appears similar to that for collision general car insurance on the BAP, inasmuch as space for a $50 or $100 deductible is shown. However, coverage D is not physical damage insurance but bailee liability insurance, and the limit of liability, irrespective of deductibles, is the same as that for property damage liability. It applies to all automobiles damaged in any one accident and is not on an object basis. That is, if two mechanics were out road-testing customers’ automobiles and happened to collide, a limit of $5,000 would fix at that amount the company’s maximum liability for both cars.
Declarations
Other Businesses and Locations; Prior Insurance Cancellations. In issuing a GLP, it is the intent of the insurer to cover only the garage risk (including operations necessary or incidental thereto). If the applicant for insurance is conducting other kinds of business at one or more of his garage locations, the company may not want to accept the risk. This is true because when different business operations overlap at one location there may be frequent disputes as to whether the GLP or the general liability policy applies in a given case. This objection is particularly pertinent if the general liability insurance on the other operations is not in the same company and for similar limits as the GLP. And, even if the insured is engaged exclusively in the garage business, the insurer wishes to make certain that it knows about all locations where operations are carried on. If the applicant submits only one location for general car insurance, it may be the trouble spot in his organization. Naturally, the insurer will want to know of any recent insurance cancellations. The applicant is therefore asked to represent that:
(a) The named insured is conducting no other business operations at this or any other location not herein designated; (b) During the past year no in-surer has cancelled any similar insurance issued to the named insured.
As these statements are inducements that the insurer relies upon in accepting the risk, they are clearly material in nature, and any misrepresentations by the insured would give the insurer grounds to avoid the contract.


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