2014

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Hired Auto and Non-Owned Automobile Liability Coverage

Hired Auto and Non-Owned Auto coverages are usually added as endorsements on a General Liability policy. These types of coverage meet contract requirements for Commercial Auto coverage when the company has no vehicles titled in its name.

What is Hired Automobile Coverage?

Hired Auto coverage can either supplement or replace a car rental agency's liability coverage. But because Hired Auto insurance doesn't cover physical damage to a rented vehicle, it still makes sense to purchase the rental agency's physical damage coverage. The Hired Auto policy's liability coverage protects only your company, not the employee driving the rented vehicle. As such, it supplements the driver's own auto liability coverage. Just as if he or she were driving a personal vehicle, in the event of an accident, the employee would still be personally liable for injuries or property damage to third parties.

Damage to the vehicle you rent is not covered

Because Hired Auto insurance doesn't cover physical damage to a rented vehicle, it still makes sense to purchase the rental agency's physical damage coverage.

What is Non-Owned Automobile Coverage

Non-Owned Auto coverage protects your company should it be sued due to an auto accident while one of your employees is on company business in a personal vehicle. Unlike a personal auto policy, this coverage will not protect you or your employee. As with Hired Auto coverage, this coverage protects the company only and supplements the driver's personal auto liability coverage.

Auto liability coverage may be described in your contract in this way: "Contractor shall carry bodily injury, property damage, and automobile contractual liability coverage for owned, hired and non-owned autos with a combined single limit of liability for each accident of not less than $1,000,000."

Why You Need Hired and Non-Owned Automobile Coverage

If an employee of your company has a serious auto accident in their own vehicle or in a rented vehicle while on company business and their personal insurance is not enough to cover the claim, your company can be held responsible. These claims can be catastrophic and the cost of this insurance is usually less than $150 per year. Every business owner should seriously consider this coverage.

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