by F Sneineh
Chicago Auto Insurance Specialist
It may be little confusing to tell the difference between temporary auto insurance, drive away insurance, and auto driveaway insurance. While temporary insurance and drive away insurance are similar in the way that temporary liability or physical damage or both insurance is offered for a particular vehicle, auto driveaway insurance is bodily injury and property damage coverage offered by businesses in the commerce of transporting customers autos from one point to another.
Temporary Auto Insurance Binders and Driveaway Insurance Are For Individuals
Temporary insurance, including 1 or 7 days auto insurance binders, is offered to individuals in situations where a temporary need for insurance is present. For example, if you are buying a car from a dealer but you are not sure whether you want to keep the vehicle or not, or are buying a vehicle as a gift for someone, or if you are debating whether to add a newly acquired vehicle to your present policy or not, then a temporary 7 days insurance binder may be helpful.
Warning about temporary insurance binder: Regardless of how good and beneficial temporary insurance is, the coverage suffer from sever problems regarding its ability to provide protection to the customers. While temporary insurance can solve many short term problems, it has a very critical problem that comes from the lack of understanding of its functionality. Most of the times temporary binders cover only physical damage (comprehensive and collision). If the operator gets in an at fault accident, then the temporary physical damage binder will pay to fix the vehicle, but will not provide any liability coverage, hence leaving the operator vulnerable for lawsuits.
If you have purchased a temporary insurance, or temporary binder, read the elements of coverage offered, limitations and conditions. These coverage may or may not be appropriate for you. If you already have an existing auto policy, coverage offered for newly acquired vehicles vary. While many companies that stick to the ISO personal auto policies will offer immediate temporary coverage (which means you do not need to purchase additional coverage), many non standard insurers do not offer any automatic coverage for newly acquired vehicles, hence you cannot count on any temporary coverage from your present auto policy.
Individuals and organizations that are in the business of transporting autos from location to location are required to carry liability to protect them in the event they cause bodily injury or property damage while using other people vehicles. While on-hook coverage for towing businesses and cargo coverage for car carriers are suitable coverages, other business that drive vehicles singly, use towbar, or saddle mount, maybe required to obtain further state licensing (in Illinois its called In Transit Plates) and separate coverage or endorsement to their existing coverage to include auto driveaway coverage.
Driveaway insurance is not to be confused with driveway insurance. Driveway applies to coverage for incidents on driveways. Normally local authorities and municipalities will ask for this coverage to issue or renew business licenses for establishments that are using driveways or any part of them to transact business (used car dealers, peddlers, etc.) Driveways are normally considered part of the business premises, hence, should be covered under the Commercial General Liability.