Should I Allow Employees To Drive Their Own Vehicles To Jobsites?

Did you know that if one of your employees is involved in an accident where he or she is on company time then your business could (and probably will) be named in the lawsuit?

How do you protect yourself in this type of scenario?   Hired and non-owned auto coverage is specifically designed to protect you and your company from situations like the one mentioned above.  This coverage protects you from bodily injury and property damage arising from the use of a vehicle that is owned by an individual other than the company, but is used on the company’s behalf.

For restoration contractors, this coverage is typically added to your existing business auto policy for a small additional premium.  (The cost will usually start at about $250 per year for a $1,000,000 in coverage.)

Coverage Tips:

  • This coverage is a supplemental coverage meaning your employee’s insurance policy will pay first. If your employee’s limits are exhausted from a claim or they do not have insurance, the non-owned and hired auto coverage will pay.  Tip: Verify all employees carry insurance on their vehicles with minimum limits of $100,000 per occurrence.
  • Coverage for “hired” vehicles will provide liability coverage for rental vehicles that you may use for company business.   Be aware that it will only replace the liability portion, not the physical damage coverage.  Therefore, it is still important to purchase the rental agency’s physical damage coverage or you can actually purchase the coverage through your current insurance company.
  • Check MVRs (Motor Vehicle Records) for all employees.   By verifying the driving records of all of your employees will help protect you from potential claims.  You will know which drivers to avoid sending on company-related errands because the potential risk they pose.