Many businesses’ routinely have employees run errands using their own vehicles. But what if there is an accident? Would your business be protected in the case of a law suit? Commercial Auto Insurance typically only covers vehicles owned by the business. There is a ‘non-owned’ and ‘hired’ endorsement that every businesses owner should have if there employees drive their own vehicles for work related purposes or rent vehicles for business use.
Unless the endorsement is added to your commercial auto policy your policy it will only cover your employees driving auto’s listed on the policy. The employee’s personal auto insurance policy may exclude business use, so there may be a gap in coverage.
After it is determined that your business needs this protection the next thing to consider is how much coverage is necessary. This limit will cover over and above the primary policy (the employee’s personal auto policy) in the event of a lawsuit. Non-Owned is a Liability only coverage so it would protect against property damage or bodily injury caused by your employee, not damage to your employees car. So you would need to discuss with your agent the coverage options that would be right for you.
There is also a stand-alone ‘non-owned and hired’ policy that would protect your business even if you do not have any vehicles owned by the business. An example of when this would be necessary would be a Pizza Parlor with delivery. The business would need non-owned coverage to cover the delivery exposure.
If you think that you may have non-owned and hired exposure you need to talk with you agent to make sure you have this important coverage.