1. Forms
2. PP
3. PP-03-13

What the form is

The PP 03 13 Excess Electronic Equipment Coverage endorsement is designed to be added to a Personal Auto Policy (PAP). Its primary purpose is to provide additional coverage for electronic equipment that is permanently installed in the insured vehicle, beyond the often limited coverage provided in the standard PAP. Standard auto policies typically include a sublimit (e.g., $1,000 to $1,500) for electronic equipment not installed by the original manufacturer or may exclude certain types of equipment altogether. This endorsement allows the policyholder to schedule a higher limit of liability for such equipment. The 06 98 edition of this form was titled "COVERAGE FOR EXCESS SOUND REPRODUCING EQUIPMENT, AUDIO, VISUAL AND DATA ELECTRONIC EQUIPMENT, AND TAPES, RECORDS, DISCS AND OTHER MEDIA".

Classes of business it applies to

This endorsement applies to personal auto insurance policyholders who have installed aftermarket electronic equipment in their private passenger vehicles. Real-world examples include:

• Upgraded stereo systems with amplifiers, subwoofers, and custom speakers.
• In-dash navigation systems, GPS units, and DVD players.
• Satellite radio receivers.
• Permanently installed CB radios or two-way communication systems.
• Permanently installed computer or data processing equipment.

Special considerations

• Permanent Installation: The equipment must typically be permanently installed in the vehicle. Portable devices are generally not covered by this endorsement and might be better insured under a homeowners or renters policy.
• Scheduled Limit: The insured must select a specific limit of liability for the excess electronic equipment, which will be shown in the policy Declarations or on the endorsement itself. This limit is in addition to any base coverage provided by the PAP.
• Valuation: Coverage is typically for the actual cash value (ACV) or replacement cost of the equipment, depending on the policy terms, up to the scheduled limit.
• Overlap with Standard Coverage: While newer editions of the standard PAP (since 2005) may offer some automatic coverage for permanently installed electronic equipment, this endorsement is crucial for equipment valued above those standard limits or for specific types of equipment that might still be restricted.
• Media Coverage: Earlier versions of the endorsement explicitly mentioned coverage for tapes, records, discs, and other media, often with a small sublimit (e.g., $200). Policyholders should verify if this is still included or if such items are covered elsewhere.

Key information for agents and underwriters

• Needs Assessment: Agents should proactively ask clients about any aftermarket electronic equipment in their vehicles to ensure they are not underinsured. Explaining the limitations of the base PAP is crucial.
• Documentation: Underwriters may require documentation, such as receipts or appraisals, to substantiate the value of the scheduled equipment, especially for high-value items.
• Pricing: The premium for this endorsement will depend on the limit of liability selected for the equipment.
• Risk Assessment: Vehicles with high-value, visible electronic equipment can be at a higher risk of theft. Underwriters might consider this in their overall risk assessment, and agents might recommend anti-theft devices.
• Coverage Gaps: Agents should clarify what constitutes "permanently installed" versus portable to avoid misunderstandings at the time of a claim. It's also important to differentiate this coverage from "Custom Equipment Coverage" (e.g., PP 03 18), which may apply to other non-electronic custom parts and accessories.