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Vehicles and State Insurance Coverage
 
What vehicles are covered by the state´s self-insurance program?
The state´s self-insurance program covers both state and private vehicles. The coverage differs.
State vehicles - A motor vehicle owned, rented, borrowed, leased, or otherwise under the possession and control of the state. A commercially rented vehicle is a state vehicle if it is rented and used by a duly authorized employee at the cost of the state, solely for official state business. No personal use is allowed.
 
Private vehicles - A motor vehicle that is owned, rented, borrowed, leased, or otherwise lawfully in the possession and control of any private person or any entity other than the state. A commercially rented vehicle is a private vehicle if it is rented or used for private use or any mix of private or state uses.
Note: Commercially rented vehicles can fall into either vehicle category.
What type of coverage is provided by the state´s self-insurance program?
It depends on the vehicle type/status.
State vehicle - The state provides physical damage, uninsured motorist, personal injury protection, and tort liability for property damage or bodily injury to others. There is no coverage for personal use.
 
Private vehicle - The state only provides excess liability coverage if the loss exceeds the private auto´s policy limits. There are conditions for coverage.  
 
 
Vehicle Type/Status   Determines Insurance Coverage
State Insurance Coverage:
Physical Damage
(Property)
 
 Tort Liability
Personal Injury Protection (PIP) 
 Uninsured Motorist (UM)
Type/Status of Vehicle:      
State Vehicle 
Yes
Yes
Yes
Yes
Commercially rented vehicle used solely for official state business (state vehicle status.) 
Yes
Yes
Yes
Yes
Private Vehicle 
No
*Excess Only
No
 No
Commercially rented vehicle used for any mix of state and private business (private vehicle status.) 
No
*Excess Only
No
 No
* Excess liability coverage has conditions for coverage.
Are there any conditions that must be followed for state insurance coverage to apply?
Yes. There are conditions for coverage. Generally, you must be using either the state or private vehicle in accordance with the Vehicle Use and Access Rules, OAR 125-155, solely for authorized official state business within state directives. Other conditions may apply.
Is the state´s automobile insurance coverage valid outside of Oregon?
The state´s automobile coverage is valid in the United States, its possessions, territories and Canada.
See the Vehicle Incident Prevent Project (VIPP) Toolkit, Vehicles in Foreign Countries, if you plan to drive in a foreign country.
How is physical damage or loss to state-owned vehicles adjusted under the state´s self-insurance program?
Property losses to state-owned vehicles are adjusted based upon the type of vehicle.
 
Passenger vehicles - Cars, trucks and vans, with a weight carrying cargo capacity of one ton or less, including attached non-motorized trailers. These vehicles must be licensed under state law for highway use. Note: This category does not include one ton cab chassis.
 
Other vehicles - Large vehicles, including sanders, snowplows, cab chassis, trucks with cargo capacity of more than one ton, airplanes, boats and trains. Note: Alternative fuel vehicles are included in this category.
How does the property self-insurance loss settlement process work for state-owned vehicles?
Passenger vehicle loss settlement - state vehicles owned by you qualify for:
  • Actual cash value
  • If surplus, the declared value at the time sent
  • The cost to repair the vehicle, whichever is lower.
Other vehicle loss settlement - state vehicles owned by you qualify for:
  • The lower of necessary and reasonable cost to repair
  • The cost of replacing it with property of equivalent function and reasonably similar to the old
  • If surplus, the declared value at the time sent
  • Totaled "other vehicles" qualify for replacement value, i.e., "new for old" coverage when the cost to repair exceeds 80 percent of NADA book (retail value) or similar depreciated value.
Other vehicle loss settlement - state vehicles that you do not own, did not purchase new, or will not replace with a new vehicle, qualify for the lower of:
  • Depreciated value
  • If surplus, the declared value at the time sent.
How are property losses to state-owned vehicles applied by the self-insurance program?
Losses to state-owned vehicles will be paid to the owning agency and charged to the driver´s agency.
 
Paid losses to surplus property will be paid to the owning agency and charged to the agency in possession and control at the time of the loss.
How do the state´s self-insurance and private auto coverages apply when a private vehicle (private vehicle status) is used on state business?
When using a private vehicle on state business, private auto insurance is always the primary coverage, i.e., it applies first.
 
There is no state coverage for property damage (collision or comprehensive coverages) to the private vehicle.
 
The state´s liability coverage may apply. If there is an accident while using a private vehicle for state business, and the loss exceeds the private auto´s policy limits, the state´s liability coverage may apply to amounts over the private auto´s policy limits.
 
The state´s liability coverage is excess. There are conditions for coverage. You must be using the vehicle in accordance with the Vehicle Use and Access Rules, OAR 125-155, for authorized official state business within state directives.
 
No private vehicle is covered in any way by the state while it is being used for any personal purpose or contrary to state directives.
Are there any special requirements for commercially rented vehicles?
It depends on the vehicle status.
 
Commercially rented vehicles used solely for official state business (state vehicle status) - The property self-insurance policy requires (effective 4/1/04) that a Limited Damage Waiver (LDW) be purchased at the time of rental.
 
A LDW is a provision in many auto rental contracts charging an extra fee to the person renting the vehicle. In exchange, the rental company waives some of its right to recover its cost of physical damage and some other types of losses (loss of use, etc.) from the renter.
 
Only the property damage coverage should be purchased from the rental company. It is not necessary to buy their liability coverage. Liability coverage will continue to be available from the state´s self-insurance program.
 
Commercially rented vehicles used for any mix of private and state uses (private vehicle status) - The purchase of a Limited Damage Waiver is not required, because there is no state coverage for this vehicle. It is up to the driver to provide private insurance coverage on a mixed use commercially rented vehicle.
 
If you do not have insurance, or your insurance company will not cover the use of a commercially rented vehicle, you may want to consider purchase of the rental company´s liability and property damage insurance. If there are any questions about the correct insurance coverage for the rental vehicle, check with your own insurance agent for advice.
 
A commercially rented vehicle used for mixed purposes cannot be rented in the name of the state.
Are state agencies always required to buy the LDW when renting a vehicle solely for official state business (state vehicle status?)
Master price agreement - The state of Oregon has a master price agreement for short term rental car services (1 to 30 days.) This agreement is designated as a mandatory use contract for designated locations. Travel must be within the United States for official state business.
 
If the master price agreement is used, insurance coverage is included as part of the rental cost. It is not necessary to purchase the LDW.
 
For further information see the DAS Purchasing Travel Contract Information Web page.
 
Not using the master price agreement - At the time of rental, purchase the LDW. It is only necessary to purchase the property damage coverage. Liability coverage will continue to be available from the state´s self-insurance program.
How is the LDW applied when there is physical damage or loss to a commercially rented vehicle used solely for official state business (state vehicle status?)
State property self-insurance covers loss or damage above the limits of the LDW that a state agency becomes obligated to pay according to the terms of the rental agreement.
 
Losses paid by the LDW are applied against the agency´s property self-insurance deductible, depending on the amount of coverage purchased.
 
Losses under the agency´s property self-insurance deductible will be handled by the agency.
For additional information on state insurance coverage for vehicles, see the Self-Insurance Policy Handbook.
Actual coverage is fully explained and bound only by the full policy wording.