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Loading and Unloading Claims: Blurred Lines of Coverage

Losses while loading and unloading vehicles, whether it is property of others in your care, custody and control or your own, can be a tangled web of policy language.

The business automobile policy anticipates the risk of loading and unloading vehicles by manpower. Goods delivered to a specific location, whether that location is a loading dock or a fourth floor apartment bedroom, is covered for liability under business automobile as long as the goods are delivered by non-motorized means - think forklifts.

So if your delivery professional dents a car in the parking lot or a hallway wall in the building while using a hand truck to deliver, the business automobile policy pays for the damage. Unloading is defined by the final destination, not just literally off the vehicle.

Delivery by motorized device is subject to general liability rules. Loading a truck on a loading dock using a pallet jack would be subject to business automobile; using a fork lift, general liability would cover damages.

Damage to your own property is subject to property coverage, specifically inland marine during transportation. Property belonging to other people while in your care, custody or control is treated exactly the same way. You need property coverage to pay for damages while in transport, including loading and unloading.

General liability and business automobile policies assure there is no double coverage by defining through exclusions which policy covers which event. Even if you use your employees vehicles in business, buy business automobile non-owned coverage to protect the business.

Ten years ago, the insurance industry adopted new provisions to differentiate mobile equipment and automobiles. These technical definitions exceed the complexity limits of this discussion, but if you have mobile equipment that ever enters a public roadway, talk to your agent or insurance professional.

Remember: manpower is business automobile, motorized loading and unloading is general liability. The cargo must be covered by a property form, probably inland marine.
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