California Property & Casualty Broker-AgentCasualty InsuranceMedium
A business client in California operates a food truck. They are purchasing a Commercial Auto Policy. Which of the following coverages would specifically protect them if the food truck is stolen, or damaged by fire or vandalism?
- ACargo Coverage
- BSpecified Causes of Loss Coverage
- CCollision Coverage
- DLiability Coverage
Show answer & explanationAnswer & explanation
Correct answer: B. Specified Causes of Loss Coverage
Specified Causes of Loss Coverage is a type of physical damage coverage in a Commercial Auto Policy that covers losses due to fire, lightning, explosion, theft, windstorm, hail, earthquake, flood, mischief, vandalism, or the sinking, burning, collision, or derailment of a conveyance transporting the covered auto. It's a named peril coverage for non-collision events.
Why the other options are wrong
- A. Cargo Coverage protects the goods being transported, not the vehicle itself.
- C. Collision Coverage only covers damage from striking another object or upset.
- D. Liability Coverage protects against claims from others for bodily injury or property damage caused by the insured's vehicle.
Specified Causes of Loss (Commercial Auto)
Specified Causes of Loss Coverage in a Commercial Auto Policy is a named perils physical damage coverage that protects against losses from specific perils such as fire, theft, vandalism, and certain natural disasters.
- Named perils coverage, meaning only listed perils are covered.
- Less comprehensive than 'Comprehensive Coverage'.
- An alternative to 'Comprehensive Coverage' for businesses seeking more limited physical damage protection.
Memory trick: Physical Damage: COLL-SPEC-COMP, Got It All!