1. Forms
2. CA
3. CA-20-33

What the form is

The CA 20 33 endorsement, titled "Autos Leased, Hired, Rented Or Borrowed With Drivers – Physical Damage Coverage," is designed to modify standard commercial auto insurance policies. Its primary function is to add physical damage coverage (such as Comprehensive or Collision) for specific vehicles that the named insured leases, hires, rents, or borrows along with a driver. Standard commercial auto policies, like the Business Auto Coverage Form (BAP), often exclude physical damage coverage for such autos because the provision of a driver can alter the nature of the risk and control. This endorsement overrides that exclusion by specifically scheduling the vehicles and deeming them as "covered autos" for the physical damage coverages selected by the insured.

Classes of business it applies to

This endorsement is relevant for any business that temporarily uses vehicles not owned by them, where those vehicles are supplied with an operator, and the business needs to insure those vehicles against physical damage. Real-world examples include:

• Companies that hire chauffeured car services for executive transport or special events and are responsible for damage to the vehicle.
• Businesses that supplement their fleet during peak seasons by hiring vehicles that come with drivers from a third-party service (e.g., a florist hiring extra delivery vans with drivers during Valentine's Day).
• Film production companies that rent specialized vehicles (picture cars) that are operated by specific drivers provided by the rental company.
• Contractors who might hire specialized equipment that is operated by the lessor's employee (if that equipment is considered an 'auto' under the policy).

Special considerations

• Scheduled Autos: The specific autos to be covered must be listed (scheduled) in the endorsement.
• Coverage Selection: The insured must select the desired Physical Damage coverages (e.g., Comprehensive, Collision) and the applicable deductibles for these scheduled autos.
• Primary Coverage: The CA 20 33 endorsement generally provides primary physical damage coverage for the scheduled autos, meaning it pays before other applicable insurance for those vehicles.
• Distinction from Hired Auto (Without Driver): It's crucial to differentiate this from coverage for autos hired without drivers. Standard Hired Auto coverage (Symbol 8 in a BAP) addresses liability and, if elected, physical damage for autos the insured rents without an operator. The CA 20 33 is specifically for the scenario where a driver is provided with the vehicle.
• Policy Language Modification: The Business Auto Coverage Form typically states that an auto leased, hired, rented, or borrowed with a driver is not a covered auto for physical damage purposes. This endorsement directly modifies that provision for the autos scheduled.

Key information for agents and underwriters

• Pricing: The premium for this endorsement is often based on the estimated annual cost of hire for each scheduled vehicle, the type of vehicle, its value, and the specific physical damage coverages and deductibles chosen.
• Risk Assessment: Underwriters should carefully evaluate the exposure. This includes considering the types and values of vehicles being hired with drivers, the frequency and duration of hire, the nature of their use, the geographic territory of operation, and the experience and reputation of the firms providing the vehicles and drivers. The contractual agreements between the insured and the entity providing the auto and driver should also be reviewed to understand responsibilities for loss or damage.
• Identifying Coverage Gaps: Agents should proactively discuss this exposure with clients who may hire vehicles with drivers. Without this endorsement, a significant physical damage coverage gap could exist, potentially leaving the client responsible for costly repairs to a non-owned vehicle.
• Underwriting Guidelines: Ensure the schedule of autos is accurate and complete, including vehicle details and values. Verify that the selected coverages and deductibles are appropriate for the exposure. It's important to understand the control and supervision the insured has over the hired auto and its driver, even if minimal.