Many businesses use vehicles they don’t own for daily operations, including rental vehicles (“hired”) and vehicles owned by their employees (“non-owned”). Using these vehicles for business purposes comes with high-risk exposures that many business owners don’t realize may jeopardize their business assets. You must speak to your clients about the risks and the available protection options. Hired and non-owned auto insurance is designed to protect a business from these risks, so your clients don’t need to chance a gap in coverage, which can become financially devastating. When staffing firms assume the primary auto liability for their clients’ vehicles, they jeopardize their ability to hold coverage if a loss occurs.
Understanding Hired Auto and Non-Owned Insurance
Hired autos are vehicles a business leases, hires, rents, or borrows that are used for business purposes. Vehicles that are leased, hired, rented, or borrowed from any employees, partners, or household members are not technically hired autos. If a client was to rent a vehicle for business purposes and get into an accident, this policy could help cover the costs if someone filed a claim against their business.
Non-owned autos are employees’ personally owned vehicles used for company business such as an administrator using their personal vehicle to run business errands, such as going to the post office once a week. The coverage applies if an employee was involved in an accident and was at fault. Typically, the employer is responsible when their employee is found negligent while performing employment duties. Non-owned auto liability kicks in after the employee’s personal auto has maxed their limits.
What is Covered by Hired and Non-Owned Auto Insurance?
Hired and non-owned insurance provide liability coverage for property damage and bodily injuries caused by an employer and employees while driving for work. This coverage works when your client’s business is sued for negligence due to an automobile accident. Keep in mind that it does not pay for collision damages to the hired or non-owned vehicle. Hired and non-owned auto coverage can usually be added as an endorsement to your general liability insurance policy.
Prior to placing an employee in such a position, staffing firms must evaluate all contractual provisions they’ve agreed to, including insurance requirements, as provisions need to be specific for non-owned vehicles.
In the event of an accident, business owners could be found negligent in many instances-such as the employee carrying expired insurance, only carrying the minimum legal limits required, their vehicle is not properly maintained, their driving record is below standard, or the business does not have any policies in place to address these issues. Staffing firms placing their employees in positions that involve driving must have a contract specific to driving exposure. Staffing non-owned auto insurance will take care of those risks.
About World Wide Specialty Programs
For the last 50 years, World Wide Specialty Programs has dedicated itself to providing the optimal products and solutions for the staffing industry. As the only insurance firm to be an ASA commercial liability partner, we are committed to that partnership and committed to using our knowledge of the industry to provide staffing firms with the best possible coverage. For more information about Staffing Professional Liability Insurance or any other coverage, we have available to protect your staffing business, give us a call at (877) 256-0468 to speak with one of our representatives.