What is a newly acquired auto?

A newly acquired auto refers to an additional or replacement auto that is acquired by an insured. This definition is important in the context of insurance because it outlines when coverage may be extended automatically under a commercial auto policy. When an insured adds a new vehicle to their fleet or replaces an old vehicle, specific provisions in their policy often provide immediate coverage for that newly acquired auto, typically for a limited time.

The relevance of this answer in terms of insurance practice is that it allows businesses to seamlessly integrate new vehicles into their operations without immediate complications regarding coverage gaps. This is particularly significant for companies that rely on vehicles for their daily business activities.

The other options do not accurately define a newly acquired auto. For instance, a rented auto, while it might be used for business purposes, does not fall under the definition of a newly acquired auto owned by the insured. An auto that was previously owned also does not meet the criteria since it refers to vehicles once owned and not newly acquired. Similarly, an auto owned by a partner or family member is not considered newly acquired by the insured entity, as it does not pertain to vehicles specifically obtained for the business's use.