BAP Liability Coverage
Coverage Overview
The BAP Liability Coverage pays sums the insured becomes legally obligated to pay as damages because of bodily injury or property damage caused by an accident and arising from ownership, maintenance, or use of a covered auto.
Coverage Trigger
Liability coverage applies when:
| Trigger | Examples |
|---|
| Ownership | Defective vehicle causes accident |
| Maintenance | Poor brake maintenance leads to crash |
| Use | Driver causes accident while operating vehicle |
| Loading/Unloading | Injury while loading cargo |
Loading and Unloading Coverage
This is an important BAP provision:
| Covered | Not Covered |
|---|
| Moving property to/from vehicle | Accidents inside the building |
| Immediate area around vehicle | Property dropped after delivery complete |
| Using equipment attached to vehicle | Independent contractor operations |
Who Is Insured
For Covered Autos
| Person/Entity | Coverage Scope |
|---|
| Named Insured | For any covered auto |
| Permissive Users | Using named insured's auto with permission |
| Anyone Liable for Conduct | Of above insureds |
Special Rules for Hired/Non-Owned
| Category | Insureds |
|---|
| Hired Autos | Named insured + permissive users |
| Non-Owned | Named insured only (NOT the employee) |
Critical Point: Under Symbol 9 (non-owned), employees are NOT covered for their own vehicles. Their personal auto policy is primary.
Out of State Coverage
The BAP automatically adjusts when vehicles travel:
| Situation | BAP Response |
|---|
| Higher minimum limits | Meets the higher state requirement |
| Compulsory coverages | Provides required coverages |
| Proof of insurance | Will certify as required |
Example: If your state requires $50,000 limits but you travel to a state requiring $100,000, the BAP automatically provides $100,000 in that state.
Supplementary Payments
These are paid IN ADDITION to liability limits:
| Payment | Limit | Details |
|---|
| Defense Costs | Unlimited | All costs of defense |
| Bail Bonds | $2,000 | For accidents covered by policy |
| Appeal Bonds | Unlimited | Cost of bond on appeal |
| Interest | Unlimited | On judgments until paid |
| Lost Earnings | $250/day | Attending trial at insurer request |
Liability Exclusions
Expected or Intended Injury
| Excluded | Details |
|---|
| Expected injury | Insured expected the injury |
| Intended injury | Insured intended to cause harm |
Contractual Liability
| Excluded | Exception |
|---|
| Liability assumed in contract | Insured contract (lease of covered auto) |
Workers Compensation
| Excluded | Reason |
|---|
| Employee injury claims | WC is exclusive remedy |
| Employer's liability | Requires separate coverage |
Fellow Employee Exclusion
| Excluded | Details |
|---|
| Injury to fellow employee | During employment |
| Can be removed by endorsement | For larger fleets |
Care, Custody, or Control
| Excluded | Examples |
|---|
| Property being transported | Cargo in vehicle |
| Property in insured's care | Equipment being hauled |
| Exception | Building damage from covered auto |
Completed Operations
| Excluded | Details |
|---|
| Work completed | After work finished and accepted |
| Abandoned work | Work left incomplete |
Pollution
| Excluded | Details |
|---|
| Most pollution claims | From covered auto |
| Exception | "Hostile fire" releases |
War and Racing
| Excluded | Details |
|---|
| War, insurrection | Including civil unrest |
| Racing | Organized racing events |
Key Definitions
| Term | Definition |
|---|
| Bodily Injury | Physical harm, sickness, disease, death |
| Property Damage | Physical damage or loss of use |
| Accident | Continuous or repeated exposure counts |
| Covered Auto | Determined by symbols |