What it does
CA 23 84 modifies the auto dealers, business auto and motor carrier coverage forms and the Single Interest Automobile Physical Damage Insurance Policy. It defines "terrorism" as activities involving force or violence, a dangerous act, or an act that disrupts electronic, communication, information or mechanical systems, where the effect or apparent intent is to intimidate or coerce a government or population, disrupt the economy, or further political, ideological, religious, social or economic objectives.
For coverages other than physical damage, trailer interchange, garagekeepers and the single interest policy, the exclusion of "any injury, damage, loss or expense" caused directly or indirectly by terrorism applies only when one of these is attributed to the incident:
- the terrorism uses radioactive material or a nuclear weapon, or one purpose was to release radioactive material;
- it uses pathogenic or poisonous biological or chemical materials, or one purpose was to release them;
- total insured damage to all property exceeds $25,000,000; or
- fifty or more persons sustain death or serious physical injury.
Incidents within 72 hours that appear related are treated as one incident for the thresholds. Physical damage and the other listed coverages are handled by separate provisions in the endorsement. The 10 13 edition applies in most jurisdictions; Puerto Rico remains on the 01 06 edition.
Who sees it
Any commercial auto account, at the insurer's option. Where states require coverage up to compulsory or financial responsibility limits, ISO uses CA 23 86 and CA 23 87, which exclude terrorism only above those minimum limits.
Selling notes
- Ordinary-scale terrorism incidents that do not meet the thresholds remain covered for liability under this form.
- CA 23 85 is the narrower alternative excluding only nuclear, biological or chemical terrorism.
- Read the physical damage provisions separately; they work differently from the liability exclusion.
