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LIABILITY PROGRAM
The Employee Auto Liability Program is an extension of the General Liability
Trust Fund and was effective on October 1, 1992. Previously, liability coverage
for automobiles was excluded in the GLTF.
The program is designed to provide liability protection for state employees
while operating state vehicles or personal vehicles in line and scope of their
job duties while on official business. All state employees are covered under the
program with the exception of educational institutions and boards and employees
of the State Docks. The statute excludes local educational institutions while
the Program Guidelines exclude State Docks.
COVERAGE
Coverage provided is a $300,000 combined single limit for both bodily injury and
property damage per accident regardless of the number of covered employees
involved, number of injured parties or extent of property damage.
State-Owned Vehicles. Coverage applies to Covered Employees for the use
of state-owned automobiles whether or not the autos are furnished for regular
use. Incidental use by Covered Employees is included. Automobiles include
private passenger as well as commercial and bus types. Mobile equipment use is
excluded, but is covered by the General Liability Trust Fund. Automobiles rented
and leased to the State are included.
Vehicles Not State-Owned. Covered employees are protected while using
"non-owned" automobiles. The reduced premium charge for these vehicles requires
that there will be private insurance or self insurance available in compliance
with the Alabama financial responsibility statute. Employee Auto Liability
coverage is excess of other available insurance.
Rental Cars. Covered employees are protected while using rental cars on
state business in the line and scope of employment.
Class I Drivers. State employees who use their own cars predominantly on
state business in the line and scope of employment are known as Class I Drivers.
This exposure is much like that of state-owned vehicles, except that the program
anticipates that state financial responsibility requirements will be met by the
owner. Premium cost is accordingly drastically reduced. Drivers not classed as
Class I are Class II.
"Contract" Employees. Certain employees are not subject to the state
merit system and work under an agreement with the participating state unit
outlining their duties, accountabilities and reporting relationships. It is the
intent to cover such employees who are intended to function as state employees.
To avoid controversy as to whether coverage applies to contract employees, the
Division of Risk Management requires a written agreement (see appendix) with
each affected participating state unit as to whether certain classes of
individuals are to be considered employees for the purpose of this coverage.
In the absence of a written agreement, the presumption will be that coverage
does not apply. The participating state unit should assure that any needed
agreement is executed.
Financial Responsibility Requirements. Alabama statutes require drivers
to prove financial responsibility for automobile accidents for at least $20,000
per person, $40,000 per accident Bodily Injury and $10,000 Property Damage per
accident. The cost structure of the program is predicated upon the fact that
employees using their own autos on state business can demonstrate financial
responsibility - normally accomplished by private insurance. Proof of liability
insurance is not required for state owned vehicles, in accordance with Code of
Alabama, 1975, §32-7A-1, et seq.
Medical Payments. This coverage, with per person limit of $1,000, applies
to passengers (non-state employees) in covered automobiles on a "no-fault"
basis. For this coverage, covered automobiles are private passenger types, law
enforcement vehicles, and buses. Also, automobiles operated by Class I drivers
are covered. State employees injured on the job are not covered for medical
payments. Available state programs for medical benefits would apply to
employees.
PROGRAM
ADMINISTRATION
The Division of Risk Management maintains a complete data base of all state
owned/leased vehicles, regular and frequent driver information along with number
of Class I drivers. You will be furnished with a schedule of these each
September for the coming fiscal year.
Each agency has designated a "Fleet Coordinator" who will be our central contact
for all auto transactions.
As you add and delete vehicles from your fleet, please do the following
promptly:
1. Send us a copy of the Auditor's Property
Card (Form #EDM-19419 or other documentation) each time you purchase a
vehicle and indicate the 3 digit use class code as listed in your employee
automobile liability instructions along with the license tag number and
state property number.
2. Send us a copy of the SD-1 form each time you transfer a vehicle to
surplus property. Please include the license tag number and the state
property number.
We will issue endorsements monthly reflecting
any changes requested in that month.
CERTIFICATION
You will receive a certification of your vehicles and Class I driver information
in the Summer of the year to validate and update for the coming fiscal year.
Obviously, an on-going update during the year will make the annual certification
process much easier. Your renewal schedule will be published from this
certification.
REPORTING AUTOMOBILE CLAIMS
Prior to the inception of the Automobile Liability Program on October 1, 1992,
the DORM distributed to each fleet coordinator of each department a claim kit
for each State vehicle as well as each Class I driver. These kits offer valuable
reference information and are designed to be kept in the glove compartment of
the vehicle. If the instructions given in the claim kit are followed, the
reporting process will flow smoothly.
The contents of the claim kit include:
Envelope - offers basic steps for the
driver to follow in case of an accident. A summary of the Alabama Motor
Vehicle Safety Responsibility Act is on the back.
Brochure - again lists the basic steps for the driver to follow in
case of an accident but also provides room for the driver to record
information which later will be needed to report the claim.
Decal - designed to be placed directly on the dash of the vehicle for
quick and easy reference for the driver. The decal repeats important
instructions for the driver in the event of an accident.
Automobile Loss Notice - should be completed by the driver and fleet
coordinator as soon as possible following an accident. Upon completion, this
form should be sent to the DORM office (Our fax number is (334)223-6282).
You also have the option of reporting your claim on-line by entering the
information directly onto the form and emailing it to us. In the event of a
serious accident or property damage, our claims staff prefers that you call
first.
Every auto being used on state business should
have in it a claim kit. If you need more kits, call us at (334)223-6120.
Please report the following types of automobile accidents immediately:
- Any automobile accident in which a State
employee is the driver of one or more of the vehicles.
- Any automobile accident involving damage to
the State vehicle if your agency has physical damage coverage.
Call your claims into DORM at (334)223-6146. If
the accident occurs after hours and is serious in nature, the driver should
report the claim to 1-800-241-1172 for immediate assistance.
DORM will need the following information by phone:
- Date, time and location of accident
- Brief description of accident
- Authority contacted/citation information
- State driver's vehicle (state or personal)
- If State vehicle, need VIN# and Tag #
- If personal vehicle, need State driver's
insurance info
- State driver's name, driver's license # and
phone numbers
- Specific duty being performed at time of
accident
- Property damage of other party (for
example, year, make, model of vehicle, extent of damage)
- Other driver's name and phone numbers
- Other driver's insurance information
- Injuries
- Witnesses
Once the DORM receives the claim, we will
forward the information to our claims service who will assign an adjuster if
necessary. The adjuster must be able to talk with the driver about the accident,
as well as inspect the vehicle if necessary.
If the vehicle involved is not State owned or leased but is the driver's
personal car being used on State business, the driver should also report the
accident to the insurance company insuring the personal car. In this event, any
insurance on the personal vehicle is primary to the State's coverage.
Reminder: coverage for the state employee applies only while that employee is
acting in the line and scope of employment. The reason we ask specific duty
being performed at time of accident is to determine coverage for the loss.
All claims are currently investigated and defended by our claims service.
However, all claims will be reported directly to our office. We will track
activity and make certain claims are handled in a timely and effective manner.
PHYSICAL DAMAGE PROGRAM
The specific coverages are comprehensive (fire, theft, wind, glass breakage,
etc.) coverage with a $250 deductible per occurrence and collision coverage with
a $500 deductible per occurrence, both regardless of fault.
Coverage is available for all state owned or long term lease vehicles with the
exception of buses and trucks with special equipment attached or included as
part of the vehicle when purchased new with a gross vehicle weight of 20,000 lbs
or less. If coverage is needed for vehicles weighing over 20,000 pounds, call
us.
Effective 10/1/98, coverage is afforded for
short-term (30 days or less)
rental vehicles.
Please notify us immediately of any vehicles (owned or long term leased) you
desire coverage for under this program. There is no automatic coverage.
If you have any questions or need further clarification, feel free to contact
us.
"OPEN LOT" COVERAGE PLAN AVAILABLE
The Division of Risk Management has, for some time, been aware of a possible
catastrophic loss situation that exists for those of you who have fleets of
vehicles parked in concentration at times. The most common example of this would
be a school bus fleet parked in a specific location for the summer months.
Here is how the coverage works:
- Vehicles would be covered for the perils of
fire, lightning or explosion, theft, windstorm, hail, earthquake, and
vandalism or malicious mischief.
- A specific garaging location must be given.
Coverage would apply only at that specific location.
- A specific term of coverage (starting and
ending dates) must be selected by you.
- A fixed asset listing of the vehicles
comprising your fleet must be submitted along with your request for coverage
and should reflect the total value of all vehicles to be covered. This will
be your insurance amount.
- A deductible of $25,000 per occurrence
applies.
- Losses are adjusted on an actual cash value
basis, vehicle by vehicle, from your fixed asset listing. As this document
will be the basis for any claims payments, it should be re-submitted to us
any time changes in your fleet are made.
The charge for this coverage will be $1.50 per
thousand dollars coverage annually. Premium cost is pro-rated if the coverage
term is less than one year. We will monitor losses and if needed, adjust charges
up or down accordingly on an annual basis.
Please feel free to call us with any questions.
FREQUENTLY ASKED QUESTIONS AND ANSWERS ABOUT THE AUTOMOBILE PROGRAM
Who is covered under the program?
All employees of a participating agency are covered without exception. You must
complete a Contract Employee Validation form for all groups of contract
employees to be sure there are no "gray" areas.
What is a Class I driver?
An employee who uses a personal vehicle on state business day-in and day-out as
if it were an assigned state vehicle and typically receives mileage
reimbursement is considered a Class I driver. Many contract employees fit into
this category and may or may not receive mileage reimbursement.
What is a Class II driver?
Class II drivers are all remaining drivers other than a Class I. They may be
drivers of an assigned State vehicle, motor pool vehicle or any other State
vehicle. They also may operate their personal vehicle occasionally on State
business. You need not report these.
What happens if we have an accident out of state or
while driving a rental vehicle?
Coverage applies in all 50 states and Canada. No coverage is provided in the
country of Mexico. Since coverage follows the employee and not the vehicle,
coverage would apply in any vehicle. Physical damage coverage is now afforded
for short term rental vehicles.
Do I need to keep my "rider" on my personal insurance
policy?
We suggest that each individual who drives a state vehicle examine their own
personal financial situation. The rider would provide excess coverage over the
state's limits of $300,000.
Will I be covered 24 hours a day?
Coverage applies any time you are operating a vehicle on official state business
in line and scope of your job duties.
Explain Medical Payments coverage.
Medical payments are incidental payments made for injuries sustained by a
non-state employee who is a guest passenger in a state vehicle or Class I
vehicle. Payments are made regardless of fault in the accident. These payments
are offered as an inducement to prevent unnecessary litigation. Medical costs
for state employees are handled through the employee medical plan or any workers
compensation type programs that a department may have in effect.
If I damage my State vehicle or personal vehicle on
State business, will you cover the damages to my vehicle?
The damages to the State vehicle are covered only if the State agency has auto
physical damage coverage.
If I run a personal errand during business hours and
have an automobile accident, do I have liability protection?
No. The automobile liability program covers the State employee for negligent
acts which occur in the line and scope of employment.
What if my accident is minor or if the accident is not
my fault, should I report it to DORM?
Yes. Although the accident may appear to be minor or you feel it is not your
fault, you need to report it to us. Injuries often arise later from minor
accidents.
If I am driving my personal automobile on State
business and have an accident, do I report the claim to DORM or my own personal
automobile insurance company?
Both. Your own personal insurance would be "primary" coverage in the event of a
loss and the State's liability coverage would be excess if you are driving your
personal automobile on State business.
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