Property & Casualty Insurance/Repossessed Auto


QUESTION: I have a couple of questions in regards to repossessed auto coverage.
The ISO form CA 2019 Repossessed Auto states under Paragraph B. that the repossessed auto is a covered auto while:
Being repossessed by you, held by your at locations listed in the Schedule for sale after repossession; or pending delivery after sale.

The question is, where is coverage afforded while the vehicle is being test driven? (the finance company has the title and the repossessed auto)
Second question, if the repossessed auto is sold on consignment at a local dealer. Where is coverage afforded for the finance company?

Appreciate your help on these.

ANSWER: Hi Shirley,

Can you clarify for me: are you asking on behalf of the repossession business or the finance company?  My response may be different depending upon the situation.


---------- FOLLOW-UP ----------

QUESTION: The finance company has repossessed the vehicle, they are now the title holder.

Coverage needed for test driving the vehicle and the second question is if they decide to have someone else (a used car dealer) sell the vehicle on consignment. Coverage is needed for the finance company in both situations for liability and physical damage.
Thank you


Thank you for clarifying.  

So when the finance company repossesses the vehicle, the endorsement would provide coverage while it is being repossessed and while it is being test driven.  

In order for liability to extend, the limit and premium must be listed in the endorsement in the proper section.  Physical damage must also be triggered by entering a limit, deductible, and premium in the appropriate section.  Physical damage, while the vehicle is parked, is location-specific.  In other words, the location where the vehicle is stored when repossessed and where it is located when being sold MUST be listed on the endorsement for coverage to apply at that location.

I would recommend some sort of agreement with the dealer that will sell the vehicles on consignment.  Most dealer policies can cover physical damage for vehicles of others left on consignment.  The agreement would designate who is responsible for the physical damage while it's on the lot to prevent overlaps or gaps in coverage.  Obviously you would want legal counsel involved to make sure the appropriate wording is in place.

I hope that helps.  Let me know if you have additional questions  

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Jay K. Williams, AAI, AIP, CIC, CRM


I can answer questions relating to the following coverages: personal auto; homeowners; commercial auto; commercial liability; commercial property; business income and all other property and casualty coverages.


I have been in the insurance industry in Florida since 1979. I am currently the president of a Florida domestic insurance company subsidiary. I've taught continuing education classes in Florida and across the country. I am quite familiar with all coverages including Florida Condominium master policies and unit owner policies. I also specialize in agent professional liability. I have been a professional educator since 2001.

I am a member of the Florida Associaion of Insurance Agents, the state affiliate of the Independent Insurance Agents and Brokers of America.

I currently carry the following professional designations: Accredited Advisor in Insurance (AAI) Associate in Insurance Production (AIP) Certified Insurance Counselor (CIC) Certified Risk Manager (CRM)

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