As a general rule, commercial auto policies cover company-owned vehicles and employee drivers. That is often sufficient for many businesses. However, if you routinely bring in temporary workers or employees drive client vehicles for work purposes, you may be increasing business risk because these activities are not covered under most auto policies. Purchasing a hired and non owned auto insurance policy can help reduce potential liability.
Why You Need Non-Owned Auto Insurance
When employees drive client vehicles during normal working activities, such as by providing home care services, taking a client to an appointment, or running errands, they enter an insurance grey area. The client’s auto insurance may not provide coverage for an accident since the vehicle was being used for business purposes. At the same time, your company policy does not extend to the client’s vehicle.
How Hired and Non-Owned Coverage Reduces Risk
By extending coverage to client vehicles, a non-owned auto policy reduces business risk. A single auto accident can lead to thousands of dollars — or more — in costs. If your insurance doesn’t cover them, your business may be held responsible. Costs can include:
- Legal costs associated with injury or property damage claims
- Repairs to a client’s vehicle
- Medical costs for injuries sustained in an accident
The right insurance is a key part of any business risk management strategy. Talk with your insurer to find out if non-owned auto coverage is a good fit for your business.