SPF 7

SPF 7 form that is used for excess automobile insurance. This is a form of commercial insurance.

When you want to buy higher limits of liability for your business and automobile insurance you can either increase each vehicle and the business policy and pay increased premiums on each item. Or you can buy an umbrella policy. The umbrella puts a certain amount of money over top of the automobile and the business insurance.

The automobile exposure is expressly excluded from the umbrella policy. So you need to add it back to the policy with the use of the SPF 7.

The SPF 7 does not increase the items that can be claimed if the original auto policy does not respond. This policy only increases the limit of liability payable. This known as a follow-form wording.

The SPF 7 increases only the Third Party liability (PLPD) section of the underlying auto policies. It will not increase the accident benefits portion of the policy or the physical damage coverage. If there is a payment made under the no-fauIt sections of the original policy then it does not reduce the point when the umbrella comes into effect.

If you have an SPF 7 endorsement then be advised that it only follows the scheduled policies. You must advise all the policies to the agent or broker so to advise the insurer. One that might be overlooked is when there are leased vehicles which has separate insurance policies. Any non-owned auto and other contingency policies should also be scheduled.

If there is separate limits for passenger hazard then these limits have to be clearly written on the SPF 7.

If your original policy has expired or stopped for some reason in the middle of the term then normally the SPF 7 is also terminated. It is not uncommon that the premiums you have paid do not get refunded. These types of policies are often fully retained - no refunds for early cancels.

The Canadian statutory forms provide cover only in Canada and the U.S. If you have some auto exposures that are worldwide then you need to talk to your broker or agent. it is very important that you understand the limitations of your policies. Ask questions and get answers. Take control of your insurance.