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Commercial Collateral Protection

Coverages:

 The lender and their borrowers are provided with insurance coverage to protect commercial collateral from loss due to physical damage or theft.

§    If the borrower damages the collateral during the policy period, the borrower is eligible to file a claim to cover the damage.

§    In the event of repossession, the lender is also protected against physical damage which occurred prior to repossession.

 

Eligible Collateral:

 Commercial Vehicles – licensed for use on public highways including trucks, trailers, and recreational vehicles.  Such collateral must be factory produced and be separately identified.

Commercial Equipment – industrial and agricultural equipment that are either self-propelled or towable.  Such equipment must be factory produced and be separately identified.

 

            Policy Rates:

 The master policy rate is underwritten for each lender.  The master policy rate is determined using lender portfolio characteristics and deductible option chosen.

 

            Deductible:

 Various deductible options are available ranging from $100 to $2,500.

 

Settlement Options:

 The normal settlement options for a borrower claim are the lesser of the:

1.    Cost to repair the collateral

2.     Actual cash value (ACV) of the property less net
salvage value.

3.     The outstanding net balance of the loan not more
than 90 days past due.

 

Premium :

 Premium can be paid monthly or annually.  Annual premium refunds are pro rata.  There is no minimum earned premium.

 

Administration:

 This collateral insurance plan is administered through a web-based system that is designed to be a simple and efficient source for the lender to request collateral insurance or cancel existing collateral insurance.