Many business auto policyholders wonder whether their coverage will apply if a vehicle is involved in an accident outside the stated radius of operations. This question often arises in cases where a BAP (Business Auto Policy) includes a 500-mile radius — enough for the vast majority of trips, but not all. So what happens if that rare 1% trip goes beyond the rated distance?
The short answer: it depends. Most evidence, however, suggests that the radius of operations is a rating factor — not a coverage restriction. The standard BAP form outlines that coverage applies within the entire United States, its territories, Puerto Rico, Canada, and, in limited cases, abroad. There’s no exclusion in the coverage form that voids coverage if a vehicle exceeds the listed radius.
That said, there are situations where a claim could be denied or a policy could be non-renewed. If the insured misrepresented how the vehicle is used and frequently operates far outside the declared radius, this could be grounds for policy rescission. But for rare, occasional long-distance trips, most insurers will not see this as material misrepresentation — especially if the agent has already disclosed this possibility to the underwriter.
Claims professionals confirm that if an out-of-radius trip is a one-time or rare occurrence, coverage is usually granted — though sometimes with a reservation of rights. In some cases, insurers may offer an endorsement for a single extended trip. This is worth requesting before the vehicle leaves for a long-distance journey, just to be safe.
It's important to remember that while the radius might not directly affect coverage eligibility, it can influence how a claim is handled — and how the insurer views future business with the agency. Too many unreported out-of-radius trips could raise red flags, even if a claim is technically covered.