Providence, RI, January 02, 2012 --(PR.com
)-- A recent warning from Rhode Island regulators about some of the often-overlooked insurance implications of winter weather highlights the importance of policyholders’ knowing that there are some situations in which their personal car policies may not apply, according to Online Auto Insurance (OAI).
A recent consumer advisory issued by state regulators says that drivers who have snowplows attached to their vehicles will likely be covered by their private vehicle policies for any liability and property damage they incur as a result of digging out around their homes or volunteering to clean up outside the residences of friends.
But when the plowing becomes commercial, things change.
Just as the cheapest auto insurance for teenagers
generally won’t cover them if they’re using their car for pizza delivery, those using their cars to plow snow for money probably won’t be covered under a personal policy.
Auto policies are legally binding contracts under which coverage providers agree to provide property, liability and medical coverage in exchange for premium payments. But as Rhode Island officials point out, personal policies provide coverage for when policyholders are using their cars for personal reasons—not for commercial ones.
According to Rhode Island insurance regulators and other industry experts, anyone who accepts payment for plowing snow could be considered to be using their vehicle for commercial purposes and may not have their damages covered under a personal policy in the event of a mishap.
Federal officials say small business owners who use their vehicles for anything but commuting to and from work should check their policies to determine whether they need commercial coverage.
According to industry experts, business owners need the same basic types of coverage for vehicles they use while plying their trade as they do for personal travel. But while the major coverages do not differ between private and commercial policies, experts point out that there are some technical differences between the two that are best handled by someone who is well-schooled in coverage requirements.
OAI advises consumers who are unsure whether they need a commercial policy to discuss the matter with their agent or coverage provider.
To learn more about this and other car insurance issues, readers can go to http://www.onlineautoinsurance.com/teenagers/
where they will find informative resource pages and a helpful rate-comparison generator.