Understanding Non-Owned Auto Insurance and Its Benefits

What Is Non-Owned Auto Insurance?

Non-owned auto insurance is a type of liability insurance that provides protection for injuries or damage caused by a person operating a vehicle that they don’t own. The coverage is typically added to an existing business auto policy or can be purchased as a separate policy. It is often referred to as “hired auto insurance” or “non-owned and hired auto insurance”. Non-owned auto insurance is designed to protect businesses from the costs associated with lawsuits, medical bills, and property damage that can arise from an employee driving a vehicle they don’t own.

Who Needs Non-Owned Auto Insurance?

Non-owned auto insurance is important for any business that requires employees to use their own vehicles while on the job. This is especially true if the employee is driving a vehicle that is not owned by the business. This type of insurance is also needed for any business that provides rental cars or other vehicles to employees, as well as for businesses that hire independent contractors to do work for them. Businesses that use courier services or transportation services may also need non-owned auto insurance.

What Does Non-Owned Auto Insurance Cover?

Non-owned auto insurance provides coverage for physical injuries, property damage, and legal fees resulting from an accident involving an employee driving a vehicle that is not owned by the business. It will also cover damage to the vehicle itself, as well as any medical bills that may be incurred. Depending on the policy, it may also cover rental car expenses.

What Is Not Covered By Non-Owned Auto Insurance?

Non-owned auto insurance does not cover damage to the employee’s own vehicle. It also does not cover any losses suffered by the employee or business due to theft of the vehicle. It is important to note that non-owned auto insurance does not cover damage to vehicles owned by the business, as this is typically covered by a separate business auto policy. Furthermore, it does not cover any medical costs or lost wages incurred by the employee.

How Much Does Non-Owned Auto Insurance Cost?

The cost of non-owned auto insurance varies based on the type of coverage and the size of the business. Generally, the cost of non-owned auto insurance is less than that of a business auto policy, as it only covers liability and not physical damage to the vehicle. Additionally, the cost of non-owned auto insurance may be reduced if the business has an existing business auto policy, as it can be added as an endorsement to the existing policy.

Conclusion

Non-owned auto insurance is an important part of any business that requires employees to use their own vehicles while on the job. It provides coverage for physical injuries, property damage, and legal fees resulting from an accident involving an employee driving a vehicle that is not owned by the business. The cost of non-owned auto insurance varies based on the type of coverage and the size of the business, but it is generally less expensive than a business auto policy. It is important to understand the coverage provided by non-owned auto insurance and to make sure that it is included in the business’s insurance policy.