Numeric or alpha-numeric codes specify which vehicles are insured under a commercial auto insurance policy. These codes, ranging from ‘1’ (any auto) to ‘9’ and other more specific designations, define the scope of coverage based on vehicle ownership, usage, and other factors. For example, a ‘2’ designates owned autos only, while a ‘7’ typically refers to specifically described autos.
Understanding these designations is crucial for businesses because it directly impacts the extent of their financial protection in the event of an accident. Incorrectly designated vehicles may lead to denied claims, resulting in significant financial losses. The utilization of these codes has evolved alongside the insurance industry to provide a standardized and efficient method for classifying risk and determining premiums.
