A Video Explaining The Unattended Auto Exclusion in Jewelers Block Policies

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The purpose of the unattended auto exclusions is twofold:

to curb what is called “moral hazard” and
to limit coverage in high-risk settings even when there is no moral hazard.

Moral hazard refers to the effect of insurance in causing the insured to relax the care he takes to safeguard his property because the loss will be borne in whole or part by the insurance company. Even if there were no moral hazard, an insurer might want to exclude coverage in especially risky situations; more precisely, the insured might agree to accept less coverage in exchange for a reduced premium.

Jewelers, and their counsel, must be aware that the jewelers block policy, although it still insures against almost all risks of physical loss, insurers will not take certain specified risks. Because of the risks attendant on high value property, the jewelers block policy contains a strict exclusion concerning theft losses from vehicles.

For example, a jeweler traveling with a case full of diamonds stops at a self-service gas station to fill his car with gasoline. He locks his car, leaves his case in the car, and walks fifty feet to the attendant to hand in his credit card. As he turns to return to his car, he sees a thief break the window of his car, snatch the case, and run away. The jeweler confidently reports the theft to his jewelers block insurer. He is shocked to learn that the loss is not insured.