VEHICLE insurance & stretching the truth

2723 Views 14 Replies 11 Participants Last post by Bee Driver, Jun 5, 2003

chrish

Discussion Starter · Jun 3, 2003

One insurance topic that puzzles me is the SCCA's requirement that competitor's cars must carry liability (bodily injury, etc.) isurance. This is puzzling, because, I don't think there is an underwriter in the US that issues policies covering _liability_ for "any vehicle that participates in timed events". It seems that the common practice is to not inform the insurer that the car is used for racing. This practice leaves the driver with a policy, but no insurance.

Does anybody know of a company that will insure (for liability, forget collision) a rally car? I've called at least 10 companies, even my beloved USAA, all said "no way". USAA explicitely asks when writing a new policy (at least the online form asks). It appears that the companies that cover classic cars and race cars only cover theft and collision.

-chris

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joeg

· #2 · Jun 3, 2003

Insurance companies generally resolve such matters between themselves, but in any event, notwithstanding the normal policy exclusion you quote, the insurer for a competitor vehicle involved in an accident immediately before/ immediately after and during a transit on an event would likely pay-up.

Even if it won't, SCCA's insurance costs are slightly less costly with the possibility of successfully challenging the applicability of the exclusion--the more the cheaper--than simply having no minimum mandatories.

jprowland

· #3 · Jun 3, 2003

My policy says nothing about any competitive events. However, I don't think "timed event" is the phrase they use, it's more common to say something that specifically points out speed as a competitive factor. Basically, they have no problem with TSDs and such. And, after all, insurance is generally only valid during road sections, a stage rally looks just like a TSD on the transits. Event liability insurance is valid on stage, not the car owner's insurance, and if you're smart you won't file collision insurance for an incident on stage.

--
JP Rowland jeremyrowland -at- mac.com
Visit my boring web page: http://homepage.mac.com/jeremyrowland/rally

daphne

· #4 · Jun 3, 2003

I would check your insurance. Most companies will not cover you for TSDs. Our local PCA chapter just changed the format of their "rally" events because people are not covered under their insurance in a "timed" event.

Daman

· #5 · Jun 3, 2003

Also...from what iv hurd...the minute you sign a waiver... you can forget abouth....your life insurance...

Alain Lavoie
24Rallyteam
http://www.abikeonline.com/24rallyteam/

joeg

· #6 · Jun 3, 2003

Not true about Life Insurance. Once it is in place for two years it's good for whatever you want to do.

Bruce

· #7 · Jun 3, 2003

The basic answer is that you have to have liability insurance on your rally car because it's driven on the street, and it's a requirement in most - if not all - states.

There is probably an insurance company somewhere that would insure the car while it's on a stage...but you couldn't afford the premium.
A person with two days to live CAN buy a life insurance policy, after all...it's just expensive.

Many companies will write a perfectly valid policy on your rally car for use on public roads, and will pay claims on it. What it takes is an understanding agent who will listen carefully to what coverage you really want, and not freak as soon as he hears the word "race." Once they understand that you do not intend the car to be insured WHEN IT'S RACING...and that it is inspected several times a year...and has all this extra safety gear...and is only driven a small number of miles annually...and can only carry two passengers...you get the idea.

If you read the policies carefully, most exclude coverage WHEN THE CAR IS COMPETING...they don't invalidate all the coverage because the car OCCASIONALLY competes.

Bruce

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wvonkessler

· #8 · Jun 3, 2003

Some observations:

1. A lot of policies have exclusions when vehicles are used for race or rally purposes. Bruce is right about normal use on the street being covered, and if you are going to be trucking around on the street, it is really a good idea to have coverage. However, do not be surprised that if you are on a transit during an event, and have an accident, that there will be no coverage.

2. On the same note, exclusions, when push come to shove, are narrowly construed, meaning that if the policy says that "race" activities are excluded, but there is no mention of "rally" activities, you might have a fighting chance. Of course, this will usually be after a denial by the company, a declaratory judgment action, etc.

3. Best bet is to be upfront with your agent and explain as Bruce says. This may scare some folks away, but if you can get them to understand, you are an insurable risk outside of race activities. This may also obviate another policy defense, which are misrepresentations (by act or omission) when applying for the coverage. Key to the understanding of this is that insurance companies insure based upon known risks, not unknown or unstated risks.

My .02

Wilson

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zipperboy

· #9 · Jun 3, 2003

I told my Life Insurance company up front about competing in Performance Rally events. They asked me for a description of what exactly Performance Rallying was, what safety standards were in place during the events, and the number of events per year that I was going to compete in.

They took all that info back to their office, and let their risk assessment people look at. About a week later, they came back to me and issued me the life insurance policy that INCLUDES while I am competing in a rally. They said the safety standards in place and the few number of times per year that I was going to compete made it an acceptable risk for them.

Daman

· #10 · Jun 3, 2003

>Not true about Life Insurance. Once it is in place for two
>years it's good for whatever you want to do.

thats good to know...thats what a otter competitor told me...and it kind of scared me...whit my dother end all...im going to check whit my company thanks for the advise Dave...

Alain Lavoie
24Rallyteam
http://www.abikeonline.com/24rallyteam/

Bruce

· #11 · Jun 3, 2003

>3. Best bet is to be upfront with your agent and explain as
>Bruce says. This may scare some folks away, but if you can
>get them to understand, you are an insurable risk outside of
>race activities. This may also obviate another policy
>defense, which are misrepresentations (by act or omission)
>when applying for the coverage. Key to the understanding of
>this is that insurance companies insure based upon known
>risks, not unknown or unstated risks.

Wilson brings up a good point. UNDER NO CIRCUMSTANCES LIE TO YOUR INSURANCE AGENT. Besides possibly amounting to actionable fraud, it can make it well nigh impossible to get insurance from anybody at any price if they catch you.

"Oops, I forgot to tell you..." is borderline.

Bruce

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Foghorn

· #12 · Jun 3, 2003

>If you read the policies carefully, most exclude coverage
>WHEN THE CAR IS COMPETING...they don't invalidate all the
>coverage because the car OCCASIONALLY competes.

It may be a fairly fine point, but since you can earn penalties while on the transits aren't you in fact "competing" even then? If an insurer wanted to find a reason not to pay off, couldn't they use that against you? Not necessarily proposing that all penalties be dropped from transits though because then schedules would be impossible to keep.

Kent Gardam

Bruce

· #13 · Jun 3, 2003

>It may be a fairly fine point, but since you can earn
>penalties while on the transits aren't you in fact
>"competing" even then? If an insurer wanted to find a
>reason not to pay off, couldn't they use that against you?
>Not necessarily proposing that all penalties be dropped from
>transits though because then schedules would be impossible
>to keep.

If an insurer wants to find a reason not to pay off, they can probably do so, no matter what. They wrote the policy, after all, and most of us don't really understand everything that's in it.

Bruce

RichardM

· #14 · Jun 3, 2003

>If an insurer wants to find a reason not to pay off, they
>can probably do so, no matter what. They wrote the policy,
>after all, and most of us don't really understand everything
>that's in it.
>
>Bruce
Insurance companies are run by Martians in Connecticut! Both are complete aliens to us down here in Texas.

Richard

Bee Driver

· #15 · Jun 5, 2003

I asked my insurance agent. He knew of no conventional policy that would cover a vehicle in a "timed" event. Not even liability. That means "no insurance during a TSD". He said an aduster would analyse the data and refuse payment.

Some "Vintage" policies will cover "Club events, Road Rallies and TSD". You have to qualify for these policies. Auto and driver 25 yrs or older, limited mileage, not a primary vehicle. No DUI. No speeding tickets, etc.

Finally a bonus for being old.

RCF

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