Which statement is correct regarding the rental coverage in BAP?

The statement that coverage is restricted to private passenger autos only is accurate in the context of rental coverage in a Business Auto Policy (BAP). This means that when the policyholder rents vehicles, the insurance provided under the BAP typically applies only to those vehicles categorized as private passenger autos.

Private passenger automobiles are usually defined as vehicles designed primarily for the transportation of passengers. Hence, BAP does not extend its coverage to all types of rented vehicles, such as trucks, vans, or heavy-duty vehicles, as is implied in other options. This specificity ensures that the insurance applicable aligns directly with the intended use of the vehicle and the nature of the business operations involved.

By acknowledging this limitation, businesses can better understand the scope of their rental vehicle coverage and take appropriate measures to secure additional insurance if they plan to rent vehicles outside of the specified category. Therefore, being aware of the coverage being limited to private passenger autos helps policyholders make informed decisions when renting vehicles for business purposes.