What it does
The business auto form's Other Insurance condition makes the policy primary for owned autos, excess for autos the insured does not own, and otherwise shares losses pro rata by limits when two policies cover on the same basis. When a contract requires the named insured's auto policy to be "primary and noncontributory" for an additional insured, that sharing rule is the problem: the additional insured's own auto insurer could be asked to contribute. CA 04 49 replaces or supplements the Other Insurance condition so that, for the insureds and situations the endorsement describes, the policy pays first and does not seek contribution from the other party's insurance. It modifies the auto dealers, business auto and motor carrier coverage forms and was introduced in ISO's 2016 miscellaneous commercial auto revision (policyholder notice CA P 009 11 16). The 11 16 edition is still current.
Who needs it
Contractors, haulers and vendors whose contracts or certificates call for primary and noncontributory auto coverage for an owner, general contractor, shipper or landlord.
Key points
- The endorsement deals only with the order of payment. The other party must also be an insured, usually through CA 20 48 or a blanket additional insured endorsement.
- Read the endorsement's trigger wording against the contract; ISO primary and noncontributory endorsements tie the treatment to the insured's written agreement.
- Waivers of subrogation are separate (CA 04 44 or CA 04 43).
Quoting and selling notes
The coverage form itself already makes Covered Autos Liability primary for liability assumed under an "insured contract", but that rule does not address contribution with the other party's own policy. CA 04 49 gives a standard ISO answer; list it on certificates when the contract calls for primary and noncontributory wording.
