Hired and non-owned auto insurance (HNOA) covers commercial liability expenses triggered by accidents involving hired (e.g. rental cars) or borrowed vehicles (e.g. employee-owned) for business use.
An HNOA policy typically covers liability claims and defense costs. It can cover attorney fees, settlements or judgments, and other court costs if the business is sued as a result of the accident. The policy will cover the actions of full-time and temporary or volunteer staff.
The HNOA policy does not cover physical repair expenses for the rented or employee-owned vehicle, nor does it cover any damage to property being transported within the hired or non-owned vehicle. So, if an employee rents a van to transport supplies to a business partner, and that employee gets into a road collision in which the van and the supplies were damaged, those physical damages would not be covered under a HNOA policy. Furthermore, the coverage does not cover accidents that happen during an employee’s commute or of they run a personal errand in the hired vehicle during or outside business hours.
Commercial auto insurance covers all vehicles that a business owns and that are used for work purposes. This is different to the HNOA policy, which only covers vehicles that are hired or borrowed by organizations for business use.
All businesses that rely on rented vehicles to facilitate transportation or ask employees to run errands in their personal vehicles should consider HNOA insurance as a wise investment. In today’s highly litigious commercial auto environment, lawsuits tend to be very expensive, and insurance protection is growing more important than ever.
Contact your agent with Professional Underwriters to discuss all your Auto coverage options.