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Loading & Unloading – What you Need to Know


Are items that are damaged while being loaded and unloaded from a vehicle covered by insurance?  

For example; A client is moving a customers goods, and accidentally damage nearby items, such as a floor or a wall. There is damage to both the customer's goods and the nearby item.  While the damage to the item being moved is covered under Bailee Coverage (Customers Goods in the custody, care, and control of the client) the property damage to the nearby item is more complicated.

Often, first assumptions are that the General Liability Insurance Policy would cover this type of situation; however, there is an exclusion declaring that if the customers’ goods are being loaded to, or unloaded from an auto, the GL policy does not cover resulting property damage or bodily injury.  

The policy defines Loading and Unloading as the handling of property while it is being moved from the place where it is accepted for movement into or onto an auto, while it is in or on the auto, and while it is being moved from the auto to the place where it is finally delivered.

The insurance industry views Loading and Unloading as a continuation of use of an auto for transport of property, and any resulting damages are therefore covered by the Business Auto Liability policy.

For example:

Example 1: Michael's Piano Tuning and Repair Service is picking up a piano for restoration using his truck as transport. While Michael's crew is moving the piano, a crew member drops an end, breaking the piano leg and scratching their client’s brand new wood floor.

Which type insurance policy will cover the repairs to the floor?

A General Liability policy will not cover the repair to the floor because of the loading & unloading exclusion.
A Business Auto policy will cover the damage to the floor.
A Personal Auto policy may cover the loading or unloading exposure, but this should be discussed beforehand with the insurance carrier.

Which type insurance policy will cover the damage to the piano?

Bailee and/or Cargo coverage would cover costs of repairs to the piano, minus any deductible.
Example 2: Michael's Piano Tuning and Repair Service is moving a piano from upstairs to the downstairs of his client’s home.   While Michael's crew is moving the piano down the stairs, the piano leg goes through the wall, causing severe damage to the wall and the finish on the piano.

Which type insurance policy will cover repairs to the wall?

Because no auto was not being utilized to transport the piano, the General Liability policy will cover any damage to the wall.  The loading and unloading exclusion doesn't apply here.

Which insurance policy will cover the damage to the piano?

Cargo coverage would cover the cost of restoring the finish on the piano, minus any deductible there may be.

In brief, if you are moving a customer’s goods with an auto, you should acquire a Business Auto  Insurance policy to cover any property damage or bodily injury that may occur as a result of the move.

Common Questions:

For how long has Loading and Unloading exclusion been a part of the General Liability policy?
Since 1973.

Where can we buy loading and unloading coverage?
Under a Business Auto policy. Start yours now. 

Where would damage to the customers’ goods be covered?
When the client’s property being moved, and damage occurs, Cargo coverage would then cover the damage.