1. Forms
2. PP
3. PP-90-01

What the form is

The PP 90 01, Special Personal Auto Policy (SPAP), is a standalone Insurance Services Office (ISO) coverage form that provides automobile insurance for individuals whose driving exposures do not typically qualify for coverage under standard or preferred personal auto policies. It is structured similarly to the standard Personal Auto Policy (PAP) but is specifically designed to address higher-risk situations. The policy outlines the terms and conditions of coverage, including definitions of key terms, liability coverage, medical payments, uninsured motorists coverage, coverage for damage to your auto, duties after an accident or loss, and general provisions.

Classes of business it applies to

This form is used for personal auto insurance for individuals who are considered non-standard or higher-risk. This can include, but is not limited to:

• Drivers with adverse driving records (e.g., multiple accidents or violations).
• Individuals with limited driving experience.
• Drivers who have had previous policies cancelled or non-renewed due to risk factors.
• Situations where the insurer deems the risk profile unacceptable for their standard auto program.

For example, a driver with several speeding tickets and an at-fault accident within the past three years might be insured under a Special Personal Auto Policy because they no longer qualify for a standard preferred or standard auto policy.

Special considerations

There are several important considerations when using the PP 90 01:

• Higher Premiums: Due to the increased risk associated with the exposures it covers, policies written on the SPAP typically have higher premiums compared to standard auto policies.
• Potentially More Restrictive Terms: While similar to the PAP, the SPAP may contain more restrictive terms, conditions, or fewer optional coverages available.
• Definitions: The policy contains specific definitions for terms such as "you" and "your" (referring to the named insured and resident spouse), "we," "us," and "our" (referring to the insuring company), "family member," "business," and what constitutes a covered "auto," including private passenger autos under a lease of six months or longer.
• Out-Of-State Coverage: The policy includes provisions to adjust coverage limits to meet the minimum financial responsibility requirements of another state if an accident occurs there.

For instance, if an insured under an SPAP has an accident in a state with higher minimum liability limits than their policy provides, the SPAP will typically provide the higher, legally required minimums for that state.

Key information for agents and underwriters

Agents and underwriters should be particularly mindful of the following when dealing with the PP 90 01:

• Risk Assessment: Underwriters must thoroughly evaluate the specific reasons an applicant falls into the non-standard category. This includes a detailed review of driving records, claim history, and any other relevant risk factors.
• Coverage Explanation: Agents should clearly explain to applicants the nature of the Special Personal Auto Policy, how it differs from standard policies, and why they are being placed on this form. This includes discussing any limitations or restrictions.
• Pricing: The pricing for SPAP policies will reflect the higher risk. Underwriters need to ensure that the premium accurately corresponds to the exposure.
• Limit of Liability: The policy declarations page will show the maximum amount the policy will pay for damages from any single auto accident. This limit is the most that will be paid regardless of the number of insureds, claims made, vehicles or premiums shown in the Declarations, or vehicles involved in the auto accident.
• Compliance: Ensure that the use of this form and any related endorsements complies with all applicable state laws and regulations for non-standard auto insurance.