Insurance exclusion language

[KGP]

I changed insurance companies this year, and in reviewing the policy there is a exclusion clause that reads:

Sustained while operating or occupying a vehicle in any prearranged or organized racing or speed contest or in practice or preperation for any such contest.

Okay, as I read that clause, I don't read HPDE's into it. Are there any insurance professionals, or others who are experienced in this matter, who can give an objective opinion?

 

[Vegas Boy]

Absolute best thing to do is to get the question answered in writing from your insurance agent. Then you have a record if you have a claim. They will try to weasel out of paying any way they can.

FYI, I had something similar happen with my home insurance with some collectible items. I was not sure if they needed to be separately listed or if they were included in the overall house contents. A few years later I had a theft claim and they were hemming and hawing until I produced the email.

Documentation is your friend!

 

[KGP]

Absolute best thing to do is to get the question answered in writing from your insurance agent.

Documentation is your friend!

Yes, but an agent is not an underwriter and not an adjuster. I did call my agent and asked if I was covered while at HPDE's, but they don't know what they are. The only thing she heard was "track," where she then quickly said "no, you're not covered." It could be argued either way, and becasue of that I would like objective feedback from those who have had specific experience, or from those who have professional insight.

 

[ANYTIME]

Absolute best thing to do is to get the question answered in writing from your insurance agent. Then you have a record if you have a claim. They will try to weasel out of paying any way they can.

FYI, I had something similar happen with my home insurance with some collectible items. I was not sure if they needed to be separately listed or if they were included in the overall house contents. A few years later I had a theft claim and they were hemming and hawing until I produced the email.

Documentation is your friend!

Do not rely on your agent. Have them ask the underwriter and get it in writing from them, not your agent. I was involved in a accident at Willow Springs and waited 6mos while an investigation was going on. It was a HPDE event, with classroom instruction and also instructors in cars. Let's not kid ourselves here, we all go to the track to race around, albeit disguised as a school or drivers education. My insurance company said your at a track and what do people do at a race track? I was even told they thought I was racing, but had no evidence that a race happened or was about to happen. If you are going to the track, have coverage in writing or change insurance companies.

 

[len3.8]

Make sure you tell them, that the events are not timed in any way. Mine has the same Jargon, But the underwriter came back with, "No timed Events", "Driver Education" events were fine. However, I think with the growing popularity of DEs, time is limited on the insurance companies that are going to keep covering DE's.

YMMV

 

[Sig]

When you present the question for an official answer, ensure that you frame the question in the exact context you need clarification on..... for example:

Are 'Driver Education Courses' that are not preperation for a race which happen to take place at a track facility covered? Ensure to insert wording that indicates you would have in-car instructors and there is absolutely no timing or competition involved.

 

[len3.8]

Right, Sig just reminded me of a past event. the insurance company actually challenged a claim.
Seems that 2 SCCA drivers were at the event with lap counters and the tripods setup. They said that the event was "knowingly being timed". That the event organizers were at fault for the heightened level that caused the accident. They claimed that their policy holder did not uphold his policy agreement, he should not have gone on the track, being that timing was being done.

I don't know what happened, and who covered what, I know that the car was totaled and the Guy, ended up fixing it anyway.

My point, make sure that they are not timing when they say they are not timing. I don't know how the insurance company found out..

I have seen people get kicked out of events this past summer for timing..

 

[Hrant]

Right, Sig just reminded me of a past event. the insurance company actually challenged a claim.
Seems that 2 SCCA drivers were at the event with lap counters and the tripods setup. They said that the event was "knowingly being timed". That the event organizers were at fault for the heightened level that caused the accident. They claimed that their policy holder did not uphold his policy agreement, he should not have gone on the track, being that timing was being done.

(cut)

..

Very interesting. So if there are people with lap timers even when the organizers have not sanctioned it - as in they are not keeping a record of it for official use, points, rewards, etc. ....., or other drivers are not aware of such practice by a few, the insurance company is arguing that one's claim will therefore be denied based on tha ction of a few others? Did I understand this correctly?

By the way, naming the insurance companies would help since sometimes the same insurer may give different answers to different people.

 

[len3.8]

Very interesting. So if there are people with lap timers even when the organizers have not sanctioned it - as in they are not keeping a record of it for official use, points, rewards, etc. ....., or other drivers are not aware of such practice by a few, the insurance company is arguing that one's claim will therefore be denied based on tha ction of a few others? Did I understand this correctly?

By the way, naming the insurance companies would help since sometimes the same insurer may give different answers to different people.

That was their argument. Whether they succeeded or not I don't know. I know that it wasn't hearsay and happened.
It was a major carrier/national/countrywide, whatever you want to call them.

 

[RSO 34]

I changed insurance companies this year, and in reviewing the policy there is a exclusion clause that reads:

Sustained while operating or occupying a vehicle in any prearranged or organized racing or speed contest or in practice or preperation for any such contest.

Okay, as I read that clause, I don't read HPDE's into it. Are there any insurance professionals, or others who are experienced in this matter, who can give an objective opinion?

That is the same exclusion in my policy. HPDE events are still covered under a policy with that exclusionary language.

That does not mean that your carrier won't try to disclaim but the organizers of your HPDE will be able to support your claim that it is covered.

 

[RP-Motorsports]

From past experience here, 99/100 track claims will NOT be covered. If you do/did get covered, either you missled the underwriter as to how/where the crash occured, or you have 1/100 of the companies that cover HPDE timed or not. I know of a guy who used to work for me who crashed during a HPDE session (NOT timed), and was told it would NOT be covered, so he softened the blow to the agent and said it happened during a touring event, and he still was not covered.

 

[NSX 3.0]

Yes, but an agent is not an underwriter and not an adjuster. I did call my agent and asked if I was covered while at HPDE's, but they don't know what they are. The only thing she heard was "track," where she then quickly said "no, you're not covered." It could be argued either way, and becasue of that I would like objective feedback from those who have had specific experience, or from those who have professional insight.

My IA thought I was covered in HPDE's until he called his underwriter and said sorry no way. I called ten different places until I found one that had no such writing in it and I saved $200 a year by switching to them. My thought is as long as there are HPDE's around and crashes occur which they do...Insurance Companies will get smart to this and exclude any type of " Schools " in their policy.

 

[RSO 34]

From past experience here, 99/100 track claims will NOT be covered. If you do/did get covered, either you missled the underwriter as to how/where the crash occured, or you have 1/100 of the companies that cover HPDE timed or not. I know of a guy who used to work for me who crashed during a HPDE session (NOT timed), and was told it would NOT be covered, so he softened the blow to the agent and said it happened during a touring event, and he still was not covered.

It all depends upon the language in the policy of the individual driver. More and more carriers are expanding the exclusion to include any activities on any track for any reason. However, KGP's exclusion, albeit in the ever-dwindling minority, would still provide coverage in a true HPDE situation.

A blanket statement that 99/100 track claims will not be covered is too broad of a generalization and does not take into consideration the specific policy language applicable to each HPDE driver.

Speaking with an adjuster, broker, underwriter, etc. generally will not result in anyone admitting that HPDE is covered. They automatically assume because it is on a track that it will not be covered despite the lack of any specific prohibition as in KGP's policy. However, what a call to your carrier may result in is a cessation of coverage at the end of your next policy period because if HPDE is covered they will want to drop you before you have a chance to crash and put in a claim.

Eventually all carriers will expand their exclusionary language to encompass HPDE so shopping around will become a moot point as the industry catches up to the growing number of HPDE participants.

 

[nsxtasy]

From past experience here, 99/100 track claims will NOT be covered.

My experience is totally opposite. I instruct with half a dozen different organizations, and many different chapters in some of them; I have also had a role in organizing track events with some. Based on this experience, two years ago I would have said that 99/100 track claims WILL be covered. Even now, the vast majority of such claims are still covered.

However, as RSO 34 so accurately and articulately notes, things are changing. Some insurance companies (including, by some reports, Allstate, one of the largest) are changing the wording of their policies to exclude any activities taking place on a racetrack, whether timed or not. Such explicit language excludes the HPDE events that had been covered in the past. While I am not sure that this will soon become universal, as Bob has suggested, the fact remains that some policy language implicitly includes such events, and other language explicitly excludes coverage.

If you are concerned about protecting the value of your car in case of an on-track incident, you can get coverage for that specific purpose from at least one specialty company that has been mentioned on NSXprime in previous topics.

 

[len3.8]

It all depends upon the language in the policy of the individual driver. More and more carriers are expanding the exclusion to include any activities on any track for any reason. However, KGP's exclusion, albeit in the ever-dwindling minority, would still provide coverage in a true HPDE situation.


Speaking with an adjuster, broker, underwriter, etc. generally will not result in anyone admitting that HPDE is covered. They automatically assume because it is on a track that it will not be covered despite the lack of any specific prohibition as in KGP's policy. However, what a call to your carrier may result in is a cessation of coverage at the end of your next policy period because if HPDE is covered they will want to drop you before you have a chance to crash and put in a claim.

Eventually all carriers will expand their exclusionary language to encompass HPDE so shopping around will become a moot point as the industry catches up to the growing number of HPDE participants.

My Insurance agent instructed me just as Robert is doing here. (Speaking of the call to the underwriter.)
I spoke to my underwriter with care, explaining the DE as a Instructed "Drivers Education Event" I didn't volunteer any more info than that. May policy hasn't changed, Yet!.

As I stated above, and RSO has here, the insurance companies are squeezing this coverage out as well.
Another twist in the mix: AutoX's were not covered on my policy. No matter to me, because I don't AutoX. I just thought it was weird that they were not covered.

I will make it a point to shop for Track Coverage for my next driving events, I suspect that they will now double in price.

 

[SCS2k]

As was told to me by a fellow car enthusiast: Don't race (or in this case participate in an HPDE) in any car that you are not prepared to push off of a cliff.

 

[docjohn]

I too can state that in the past five years in the NE I have seen 3 badly damaged cars(that I know of) at our usual hpde's and all have been covered,,,once!As RSO has stated there may be more exclusionary language in the works,,so check your underwriter.

 

[KGP]

Good responses guys. FWIW, I also got some personal advice from an adjuster, and his advice is exactly the same as Bob's; That it "It all depends upon the [specific] language in the policy of the individual driver." In my case I would be covered.

 

[tucsonsx]

Insurance for a specific event to cover any situation putting the vehicle and driver in greater risk ( travel to Mexico as an example ) seems fair to me and is probably the way people will obtain coverage for HPDE in the future. I certainly, as a member of a mutual insurance company, don't feel like paying higher rates for expensive cars that got wadded up at high speed on the track when their owners found the limit of adhesion no matter what the " event " is called.

 

[RP-Motorsports]

My experience is totally opposite. . Based on this experience, two years ago I would have said that 99/100 track claims WILL be covered. Even now, the vast majority of such claims are still covered.

I too know of cars that crashed, and were covered, BUT were towed off- track to a different location PRIOR to the call to the insurance company. You fill in the rest of the story. I would like to hear actual recent testimonials, including exactly what was disclosed to the agent as to how and where the crash occured. I know of more people getting turned down, and cancelled by telling the truth, and equally of more people getting covered, and missleading (fraud) the agent as to the true circumstances, than people telling the truth, getting covered, and even less people actually NOT being dropped after a successful claim was made.

I agree with an earlier statement, that if you are NOT mentally and financially prepared to write off damage to your car, you do NOT belong on the track.

It really is a catch 22, because I have a friend who was scared if he would be covered or not after a track crash, and contemplated "making up a story" so it would be covered, but decided it was morally correct to tell the truth, so he did, thus ending up having his claim denied, (out $15k) and then being dropped because he submitted a track claim. A.F. Ins. This was a HPDE event.

How do you explain being in an advanced run group, or in an instructor group running solo, and having no classroom instruction at a HPDE? It really is an open track session for us. Very very gray area.

 

[nsxtasy]

I too know of cars that crashed, and were covered, BUT were towed off- track to a different location PRIOR to the call to the insurance company. You fill in the rest of the story.

My reference was to cases in which the insurance company was told the truth - the nature of the event and where the incident occurred. In some cases, the insurance company later cancelled the policy, and in others, they later inserted a rider excluding all further claims that take place on a racetrack - but in all the cases with which I'm familiar, the insurance company paid the claim.

Check with the people in your area who are in charge of running HPDE events for PCA, BMW CCA, etc, and you'll discover that this is usually the case with most of their recent incidents.

 

[ScienceofSpeed]

And I've seen Jim's race car, he's not joking!

-- Chris

As was told to me by a fellow car enthusiast: Don't race (or in this case participate in an HPDE) in any car that you are not prepared to push off of a cliff.

 

[NSXDreamer2]

Everytime reading posts like this make my back hair stand straight... Or it's like a big bucket of water pour on my "go fast crack pipe".
Driving at high speed is dangerous, and I admit that at some extent we are all going for the thrill. I always told myself that "I'm going to drive it home in one piece." and cool down when I'm running a little too hot.

I guessed that's why whenever I go to a track day and I see some careless individuals (mentally / physically etc), I will be very mad, and that, most of the time, happens to HPDE schools with newbies who attended a driving school once and go solo the first time. (well, some also lied they have been on the track and don't know what they are doing.)

Anyways, I also felt that it's unfair to the insurance companies, I guessed I'm torn between both sides. First I will think we are "legally" throwing ourselves into sweeper at triple digit speed, I don't think insurance company had the "datas" to determined how much risk we are taking, as opposed to Highway stats. But then, think about how many of us quit driving fast on Highway/Street after attending HPDE?? Not to mention the greater driving skill and car controls. I would think that in early years, this what the insurance company would take as a reason to cover the loss for their "premium" customer. (I used premium because 'track days' wasn't as popular as recent 3 years before, and those who attend these driving schools are usually rich people who can afford some high performance cars, which the insurance company earn a lot of money from them.)

I think the current movement will eventually bring more insurance companies jump in the business of offering track insurance, (Ken said there's one already.)... Which, I'm afraid, making the track experiences more and more expensive.

 

[CokerRat]

But then, think about how many of us quit driving fast on Highway/Street after attending HPDE?? Not to mention the greater driving skill and car controls.

Very true. The sad irony is that someone who tears around like a maniac on city streets putting other motorists and pedestrians in danger will be fully insured if he crashes. Yet when you take your car to a safe and controlled environment, you do so at your own risk. There is at least one insurance co. up here that was (maybe still is) actively seeking out names of people who attend track events of any kind, including autocross, and canceling their insurance. As many drivers find out, once a company cancels your policy, it is extremely difficult to get coverage elsewhere.

 

[nsxtasy]

There is at least one insurance co. up here that was (maybe still is) actively seeking out names of people who attend track events of any kind, including autocross, and canceling their insurance.

I haven't heard of that. However, it sounds like you might be thinking of some auto manufacturers (Mitsubishi and Subaru) who, according to some reports, are actively seeking out names of people who attend track events of any kind, including autocross, and cancelling their warranties. Insurance companies don't need to seek out that information; they simply investigate when claims arise.