Hired and Non-Owned Auto Insurance

Hired and Non-Owned Auto

When a business buys a commercial auto policy, hired and non-owned auto insurance is commonly added (or endorsed) onto that policy. This endorsement adds additional coverages for the insured in the event there becomes a liability issue for their business for an automobile accident involving a vehicle they don’t directly insure.

Small business owners should get a hired and nonowned auto insurance quote to help protect their business from employee accidents.

Hired and non-owned auto insurance may also be purchased by companies that do not own vehicles, or have a commercial auto policy, in order to protect the business liabilities stemming from a vehicle accident or injury. Most business owners have a very real risk and likelihood of having a claim involving a hired or non-owned vehicle. This type of coverage can easily be added to most general liability policies, or it can be purchased for a reasonable premium.

What is Non-Owned Auto Coverage?

Hired and non-owned auto liability coverage pays for damages to a third-party, on behalf of the insured, if the business is held liable for an accident or injury caused by a vehicle they hired or a vehicle someone used while performing work for a business. If you send an employee to the bank or to the store on behalf of the business, your business could be sued for damages in the event of an accident.

Non-owned auto insurance provides additional business liability protection beyond each employees’ personal auto insurance policy.

It’s important to point out that personal auto policies have policy exclusions that limit or negate coverage for vehicles being utilized for a business function. And even if a personal auto policy does provide some coverage, most personal auto limits don’t have enough coverage in force to pay for a serious claim. In fact, over 80 percent of all personal auto policies are quoted using state minimum liability limits. Hired and non-owned insurance will either replace or overlap a personal auto policy in the event of a business auto accident.

Hired Auto Liability is different than Non-Owned Auto Liability

Hired and non-owned auto is a common term when describing this type of insurance. Hired Auto Liability is separate and distinct from Non-Owned Auto Liability. Each type of coverage is listed separate on a policy and represented by different coverage symbols.

Hired and Non-Owned Auto Insurance Symbols:
  • Symbol 8: hired auto coverage.
  • Symbol 9: non-owned auto coverage.
  • Hired auto insurance only provides coverage for vehicles that are rented, leased or borrowed by the business or insured. For example, if you borrow or rent a vehicle because your company car is in the shop, symbol 8 (hired auto) will provide liability protection for the vehicle being rented or borrowed.

    Non-owned auto insurance may be more important due to the risk for most businesses. Symbol 9 (non-owned auto) provides coverage for all other vehicles used for business functions other than owned, or scheduled, autos and hired autos. This coverage protects your business when employees utilize their personal vehicles for work-related tasks.

    Hired and non owned business auto provides insurance protection from employee auto accidents and leased vehicles.

    Hired and Non-Owned Auto Risk Examples:

    Sales people driving to appointments
    Employees taking deposits to bank
    Running business errands for boss
    Picking up lunch for office event
    Delivery documents to a business or customer
    Taking mail to the post office
    Renting a car while out of state

    Every time your employees use their own vehicles for company related business, your business is at risk for a non-owned auto liability claims.

    Hired and Non-Owned Auto Quotes

    Auto liability insurance for hired and non-owned vehicles may be the single largest risk or exposure for many types of businesses. And many B2B contracts require proof of insurance coverage for hired and non-owned autos.

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    General Liability Shop.com offers fast an affordable auto liability insurance quotes for nearly every type of business. Whether you’re looking for a complete commercial auto policy, or simply want to ensure your business is protected from the risks associated with hired and non-owned autos, we can help.

    Start your auto quote online or give us a call today at 800-900-8657.

    What if My Employees Have Personal Auto Coverage?

    Even if your employees have their own personal auto liability insurance, it’s still important that all businesses that allow employees to use personal vehicles for work-related tasks purchase non-owned auto liability insurance. Aside from the additional layers of auto insurance coverage provided by a hired and non-owned policy, most hired and non-owned auto coverages include the costs of legal defense should your business be pulled into a lawsuit. A groundless lawsuit brought against your business could cost thousands of dollars to defend. This type of policy helps assure your legal costs are insured.

    Hired and non-owned insurance is not a replacement for personal auto insurance. In fact, business owners who have employees that utilize their own vehicle for business use should require and verify that employees have current coverage for personal auto at least once a year. Personal auto insurance is a good first line defense when there’s an accident. Additionally, verifying coverage is a good way to help ensure that employees don’t fabricate a work-related story in order to get coverage after an accident.
    Personal auto coverage will not provide coverage for accidents related to work or business.


    How Much Does Non-Owned Auto Insurance Cost?

    Hired and non-owned auto insurance is a very affordable insurance product. The cost of coverage for most business owners with fewer than 20 employees is often only a few hundred dollars annually. The easiest and most affordable way to price hired or non-owned auto is to have it priced as part of your general liability or professional liability coverage. Hired and non-owned insurance is also easy to add to an existing commercial auto policy, a BOP, or a commercial insurance package.

    Business owners looking for the best protection, in terms of coverage limits and peace of mind, should consider pricing an umbrella policy. Umbrella insurance expands coverage and increases your limits of insurance over the top of all active policies.

    Learn more about Umbrella Coverage.