Car Insurance Exclusions and Agreements for Truck & Auto Coverage

In car insurance contracts, exclusions are limitations or restrictions of the coverage granted by the insurance agreement. Basically, they cover three types of exemptions: 1) “Nonfortuitous damage” - i.e. damage intentionally caused by the insured for the purpose of collecting insurance; 2) Duplication - i.e. an insured cannot received Workers’ Compensation and bodily injury damages from their car insurance for the same injury; and 3) Nonstandard risks - this includes auto repair damage, among other exclusions.

Filing a claim is a stressful experience, but it is even worse when you find out that there is an exclusion preventing you from collecting. For this reason, it is important that we examine car insurance exclusions in greater depth.

Road Rage and Grandma

Most car insurance agreements have exclusions that explicitly state that the insurance company will not provide coverage for “road rage” related damages. In other words, any bodily injury or property damage caused by intentional acts is not covered by your car insurance. So think twice before rear-ending that jerk with the offending bumper sticker!

It’s also important to know that any damage to property being transported is not covered. If, for example, you break your Grandma’s priceless urn when you are sideswiped by an ice cream truck, your insurance will not pay to replace the urn. Hopefully, Grandma wasn’t inside it! This exclusion also extends to property that is not owned by you - i.e. rented equipment, borrowed items, and goods that are in your “care.” So drive extra carefully!

The Nanny vs. the Burger Flipper

Let’s say you own your own fast food restaurant with a twist - you deliver! Now, couch potatoes can get their greasy burgers and fattening fries without ever having to leave the loveseat! If you allow one of your burger jockeys to use your car for deliveries and he is sideswiped by an ice cream truck, you are not covered. Personal car insurance is not for business operations, and if you use your automobile for business (other than farming), you are living even more dangerously than your trans-fat swilling customers.

But despite your lack of insurance acumen, your business has been a hit. You’ve gotten rich and decided to hire a live-in nanny for the kids. She is your employee, just like the burger boy, but when she is sideswiped by the same darn ice cream truck, you are covered. This is because so-called “domestic servants” are not considered employees for car insurance purposes. You could say that this is an “exemption to the exclusion.”

Duck and Cover!

One particularly strange exclusion is the one for nuclear accidents. It is standard for insurance companies put in their contracts that they “do not provide liability coverage for bodily injury or property damage for which that insured is insured under a nuclear energy liability policy or would be insured under a nuclear energy policy but for its termination…” What?

For the 99.9999 percent of us who don’t live within 100 miles of a nuclear power plant, this sure seems like an odd exclusion. But imagine the shock of the 0.00001 percent of people who are denied claims based on it! For this reason, it is important to fully read your car insurance contract and to be fully aware of all of its limitations and exemptions. Informed consumers get the best auto insurance rates, and with the internet, it has never been easier to be well-informed. Just be sure to steer clear of nuclear power plants and ice cream trucks, and you will be well on your way to saving thousands of dollars on your insurance.