Why Every Small Business Needs Hired and Non-Owned Auto Liability Insurance

An employee becomes a quick errand-runner for work, driving their own vehicle to pick up supplies. An accident takes place. The other driver sues, and suddenly your company is liable for damages.

Sounds unfair, right? It means, it wasn’t a company vehicle. But therein lies the catch, your company could still be liable.

So that’s where hired and non-owned auto liability insurance comes into play. Many small business owners think their personal auto insurance would cover them, but that’s often not the case. And without it, a simple work-related drive can turn into a financial disaster.

What is Hired and Non-Owned Auto Liability?

Hired and non-owned auto liability insurance covers businesses when their employees use rented, leased, or personal cars on company time.

The policy protects businesses from Why businesses need non-owned auto insurance liability claims for bodily injury or property damage sustained because of the actions of those vehicles, but it does not cover any physical damage to the vehicle itself.

This type of coverage is very important for businesses that depend on transportation by employees for errands, travel for business purposes, or picking up clients. If an accident occurs and the employee’s personal auto insurance is exhausted, this policy can help cover additional liability costs so the company does not incur financial loss.

Why Small Businesses Need Hired and Non-Owned Auto Liability Insurance

Why businesses need non-owned auto insurance? If your company needs people to get things done, make deliveries, or hire vehicles to work, then you need an insurance that goes beyond a usual one.

Small business commercial auto insurance like Hired & Non-Owned Auto Liability Insurance insurance covers vehicles your business doesn’t own but are used for work purposes—whether it’s an employee’s personal car or a rented van for an event.

Here is why this coverage is important:

• It fills the gaps of personal automobile insurance: Most personal policies will not cover any accidents that occur during business time.
• A lawsuit protects your business: In case of an accident caused by an employee, your company may also be sued.
• This is cost-effective protection: Considering the cost of a lawsuit, it becomes a cheap insurance cover.

Hired auto insurance for small business covers against unforeseen legal and financial liabilities for a small business. The last thing any small business would want is an unwanted expense crippling its business operations.

What This Coverage Actually Protects You From

Running a business may come with risks, especially when employees use company vehicles for work. In that case, Small business commercial auto coverage such as Hired & Non-Owned Auto Liability Insurance that saves itself from unexpected accidents and legal headaches caused by those accidents. Here is what it protects you from:

• Accident With an Employee’s Own Vehicle: If an employee met with an accident in his or her own car while doing a work-related task, their claim could be denied by personal insurance. Hired and non-owned auto liability insurance steps in to cover the damages.
• Rental Car Incident: Do you need a vehicle for your conference or a site visit? Unfortunately, if an employee or you gets in an accident, you may have to pay the bill for damage. This insurance accommodates that.
• Lawsuit from Injured Third Parties: If someone should decide to sue your business for an accident involving a non-owned or hired vehicle, this policy can meet legal costs and settlements.
• Medical and Damaged Property: This insurance ensures that when either hospitalizing someone or repairing property, this business does not have to pay anything.

What Happens If You Don’t Have Coverage?

Here is the bitter truth. Without hired and non-owned auto liability insurance, your business is exposed to serious financial consequences. Even single accident can lead to:

• Massive draining lawsuits on your business finances
• Hard medical bills and property damage costs
• Loss of business assets from legal judgments

Considering that the average cost of an auto liability claim is about $20,000, a single random event could risk the very future of your business.

What Businesses Need This Coverage the Most?

If it has employees who occasionally commute for work, even for a few minutes for work related to a task, then your business needs this insurance. It literally suits businesses like these:

• Consultants and freelancers who travel to client meetings.
• Real estate agents who drive clients to property showings.
• Catering and event planners using rented cars to transport their clients.
• Retail or e-commerce business that uses third-party delivery drivers.

Hired auto insurance for small businesses guarantees protection even if your business does not possess company vehicles because it could happen that a rented or employee-owned vehicle is used.

How to Get the Right Coverage for Your Business

Getting the right hired auto liability for businesses, it will not be that complicated for big business entities. That’s often an add-on to your existing policy with most commercial insurance providers. But when choosing coverage, you will have to think about:

• How often employees use their own cars at work.
• If you frequently rent vehicles to perform business operations.
• The level of liability protection required for your enterprise.

Adding hired and non-owned auto liability insurance into your policy would generally mean a less cost in return for very real and valuable peace of mind.

Conclusion

If you have reached this page, you can clearly deduce something- that you would not want to leave your business exposed to an undue risk. The Importance of HNOA liability insurance for small businesses holds a lot of importance.

Whether it involves an unfortunate accident with a rented vehicle or an employee who gets into an accident with his vehicle on business affairs, this insurance coverage works to save your business from a financial death trap. So do not wait for an accident to happen in order to find out what else you need; call your insurance broker today to ensure your business is covered.

Dan Levenson

See Full Bio