The first time Carl Dietrich brought his flying-car concept to the Experimental Aircraft Association’s annual AirVenture gathering in Oshkosh, Wisconsin, he had only a video to show the aviation geeks who wandered by his modest stall. The following year, he brought the mock-up of a wing. Six years later, in July 2013, he was finally ready to fly the prototype.
As the announcer who introduced the Terrafugia Transition put it: “Ladies and gentlemen, this is one of the most incredible things we’ve seen, ever, here at Oshkosh. Twenty-five minutes ago, this was a street-legal automobile. Now, it’s in the air.”
Pilot Phil Mateer buzzed the crowd while the announcer patched into his cockpit microphone to ask him how it felt up there. “I’m in a car looking down on traffic,” Mateer replied. “And it flies real nice.”
Question from an IIABNY member: Back in the day when I became a licensed broker, the only P&C option available was a full P&C license to become an agent or broker. Now with GEICO coming to western New York, the option of having a personal lines license is available. My question is, if a staff member opts to only obtain a personal lines brokers license, as an agency does that prohibit us from allowing the staff member to do certain things in commercial lines? I understand that they shouldn’t be selling commercial lines but what about serving commercial lines?
Answer: I think the best way to answer this question is to look at the definitions in New York insurance law, specifically Section 2101.
I got an email last week from an IIABNY member whose client was battling with an insurance company over her teenage son. This client is a single mother whose son resides with his father. The son is of driving age, and his father has him listed on his auto insurance policy as a driver. However, the mother's insurer insisted on listing him (and charging for him) as well. Their reasoning was that the father carried only the state minimum limits for auto liability insurance, while the mother carried much higher limits. The carrier service rep wrote to the mother, "Since (your son) meets our definition of an insured person, if the coverage were to be exhausted on his policy due to a claim, it is possible that your policy would be secondary.” Is that true?
I don't think so.
The mother's policy had language very similar to that found in ISO's Personal Auto Policy, which states:
"We do not provide Liability Coverage for the ownership, maintenance or use of: …
3. Any vehicle, other than 'your covered auto'", which is: a. Owned by any 'family member'; or b. Furnished or available for the regular use of any 'family member'. However, this Exclusion (B.3.) does not apply to you while you are maintaining or 'occupying' any vehicle which is: a. Owned by a 'family member'; or b. Furnished or available for the regular use of a 'family member'."
Therefore, if the policy is in the mother’s name, it will provide Liability Coverage for her while she is maintaining or occupying a car that her son has regular access to, but it will not provide that coverage for him. Thus, if he injures someone with a vehicle scheduled on his father’s policy, and that vehicle is available for his regular use, then only the father's policy will respond.
It's important to keep in mind, though, that if the son customarily has access to his mother’s vehicles when he is staying with her, the company is within its rights to price for that exposure.
Disclaimer: The following is my opinion only. I do not speak for my employer or its board of directors.
Just before I left work one night last week, I got my ear roasted again by an insurance agent frustrated about certificates of insurance. I don't know how many calls I get each week about certificates, but they come in often enough.
According to a 2011 article by Bill Wilson of Big I Virtual University, it costs an insurance agency $7 to issue an ACORD certificate without any customization; adding custom language or terms may double that cost. An agency insuring one middle market construction account that needs 100 certificates annually will spend between $700 and $1,800 to produce those certificates.
I got a phone call from a member while I was driving to work this morning (disclaimer: I have hands-free access in my car), and it got me thinking that some New York insurance producers need more information. As I've reported in this space before (and discussed in a July webinar,) ACORD introduced a new form specific to New York last May. The form is New York Construction Certificate of Liability Insurance Addendum, form number ACORD 855 NY (2014/05).
Since ACORD launched the form for use, I've received a number of inquiries from members wanting to know how they can get a copy. This morning's caller asked if she should go to the Web site of the New York State Department of Financial Services to get it. This told me two things, one of which I already knew: 1) Agencies are not yet able to download the form from their agency management systems, and 2) some are under the misimpression that the New York State government created and is mandating this form.
I've posted a few times about ridesharing services (you can relive the glory here and here.) Ridesharing is just starting to creep up as an issue in New York, but I think it will grow bigger in the future. If you're not familiar with services like Uber and Lyft, I recommend you watch this 14-minute documentary. Chances are that some of your clients are either already doing this or are thinking about it. They might not have the insurance coverage they think they have.