Pit Vehicles

It appears that as we roll into 2006, the NHRA is going to finally enforce the almost legendary pit vehicle insurance requirements.  We’ll look briefly into why this rule has been enacted and what you can do about it, and some of the pitfalls that await both sides.  

First, it is obvious that actual claims against NHRA’s insurance carrier triggered this rule.  While the waiver we sign applies to racing events, tow vehicles aren’t part of the competition and the waiver probably does not apply, especially after hours when we’re just hanging out.  Almost ALL of the non-registered vehicles in the pits of the racetrack are not insured, but as you know they can cause serious injury.  And if an injury occurs, courts tend to look for ‘deep pockets’, which until now has spelled NHRA’s insurance carrier.  

To operate an unregistered tow vehicle in 2006, we have to register it with NHRA (the race track). I assume from the language I’ve heard that if the vehicle is NOT used to tow, it is not subject to these requirements.   We also have to provide proof of insurance.  Let me show why your regular auto and home policies provide no coverage for these vehicles.  An auto policy does not provide liability coverage for things that are not registered autos, so we’re out of luck there.  You can find this stipulation under the exclusions in the liability coverage section.   Most people think their homeowners responds, but that is not the case.  Here is the relevant exclusion from an actual standard homeowners policy:

                Coverage E, personal liability does not apply to bodily injury and property damage:
                                Arising out of:
                                                The ownership, maintenance, use, loading or unloading of motor vehicles
                                                or all other motorized land conveyances, including trailers, owned or
                                                operated by or rented or loaned to an insured

                                This exclusion does not apply to:
                                                A motorized land conveyance designed for recreational use off public roads
                                                not subject to motor vehicle registration and Not owned by an insured
                                                or owned by an insured and on an insured location A motorized golf cart
                                                when used to play golf on a golf course

The above is not the entire wording of the exclusion but the relevant wording.  For those of you not learned in ‘insurance-ese’, it says that all motor vehicles are excluded, and then makes some exceptions to provide coverage.  The first part of the exception covers nonowned vehicles.  It means that if I drive your tow vehicle, it would be covered, but if I drive my own vehicle off an insured location (meaning the grounds of your home) there is no coverage.  The second part of the exclusion clarifies the coverage for a golf cart.  Please keep in mind this is standard wording and you must consult your own policy to be sure of what your coverage says.  

The bottom line is that your homeowners does not cover the tow vehicles in question, so you have to get coverage from another source.  This means, for most of us, a separate policy.  Some companies MAY offer an endorsement to the homeowners policy to cover a miscellaneous vehicle, so ask your agent first if that is an option.  The next step is a ‘stand alone’ policy for the tow vehicle.  

The availability of these policies is going to vary by location and type of vehicle.  Traditionally, I have found it difficult to find coverage for golf carts.  The good news is that a typical policy is not expensive; many are under $100 per year for minimum coverage.  However, there are still issues to consider, and I don’t have the answers for them:

-          Drivers with poor driving records can cause that premium to go up, as well as young drivers.  If they are not listed on the application, will there be coverage if they get into an accident driving the vehicle?  Also, is there coverage if children who are not licensed drive the vehicle?

-          All policies include a racing exclusion.  How does it read, and can it possibly apply to towing a race car?

-          What coverage is right for you?  Do you want just minimum limits?  Remember most of these policies also provide uninsured motorists coverage, which protects you.  Also, if you have a personal umbrella policy you need to see if you are required to carry certain limits of liability on these vehicles and find out if the umbrella covers them at all.

-          A general question is what, if anything, this policy will do to benefit NHRA.  My own belief is that NHRA could still be sued in the event of a major accident, and that the policy you get will not protect the NHRA in any way (making the whole thing an exercise in futility on their part).

-          Last, don’t forget the value of your tow vehicle.  Is it worth insuring, if so, where?