Why Do I Need to Buy and Utilize Hired Auto Coverage?
Hired Auto Coverage provides coverage for commercial liability expenses resulting from accidents involving Hired Automobiles. There are many types of businesses which require operational use of Automobiles. Some of them own these vehicles, while others merely borrow or rent those vehicles for a purpose. While it is preferable that the automobiles you use for business are better owned by you.
However, not all businesses can afford to own different vehicles for different purposes. Therefore, they hire the vehicles from a rental company, or their employees utilize their personal automobiles for business purposes. If such vehicles are used, it comes along with a common automobile loss exposure. Such exposure could put said business at great risk. That is why it is essential for you to purchase a Coverage to better protect your corporate interests.
What is a Hired Auto?
Hired Automobiles are the vehicles that are hired, rented, borrowed or leased by your business. These vehicles are used to accomplish a task, or tasks in busines operations. A vehicle that you borrow, lease, rent or hire from; an employee, partner, LLC member, household person, is not considered ‘Hired Auto’.
Road is a dangerous place. According to some legitimate studies, the third highest cause of deaths in the United States of America. When you go out on the road, there is always a chance, some slight carelessness could result in a disaster. It does not matter if you are running a personal errand, or a business errand. The risk remains prevalent regardless of all causes. That is why it is essential for you to acquire a Hired Auto Insurance for protection. If a lawsuit is filed against you due to an accident, this insurance policy will provide you with sufficient coverage. It is designed to cover Non-Owned Auto Liability Coverage.
What is a Non-Owned Auto?
There is small but subtle difference between Hired and Non-Owned Automobile. Such small difference does not make much of a difference in real life situations. However, in the insurance industry, these subtleties are everything. Non-Owned Vehicles are generally owned by an employee. The employees use these personal vehicles to accomplish a business-related task. A Hired Auto provides coverage for a Non-Owned Auto as well. Following are 2 situations when Non-Owned Auto Coverage claims are made;
- When administrative employees use a personal automobile to run business tasks. This includes menial tasks; such as visiting a bank, or a post office.
- When Sales, or Customer Services employees are given an allowance for the usage of their personal vehicles. They use their own vehicle, in place of the company vehicle.
This C provides protection against above mentioned scenarios. If an employee gets involved in an accidental collision, and is found negligent, then the insurance would provide appropriate coverage. Every State has its own set of laws and regulations regarding accidents involving Hired Vehicles. However, it is generally understood that the employer is held responsible for the negligence. It is not necessary for the employer to occupy the driving seat at the time of accident. The responsibility still lies with him or her.
Non-Owner Auto or Hired Auto is applied as liability insurance, once the limits of regular policy have exceeded. Therefore, it is essential for all employers to purchase a decent insurance policy to save themselves the trouble.
The Scope of Coverage in Non-Owner or Hired Auto Coverage
Hired Non-Owned Auto Coverage is an essential insurance policy. It is designed to provide liability coverage for the damages caused by yourself or your employees while driving for work. Importance of Hired Auto Liability Coverage cannot be super stated enough. It covers property damage, as well as bodily injuries. This is how it works;
- The policy would provide coverage if your business is sued for negligence in an automobile accident.
- There is no coverage in the policy for collision damages to the hired or non-owned auto. It means Physical Damage will not be covered.
- Hired and Non-Owned Coverage can be added as an endorsement to the General Liability Insurance.
Why Do You Need Hired Auto Coverage?
Accidents can happen any time and any place. Avoidance of an accident is never a certainty. In the event of an accident, you can be found negligent for many reasons. Such as;
- The employee is driving despite having his or her insurance lapsed.
- Insurance policy carried by the employer only carries a minimum limit, as required by the State. However, the damages exceed this limit.
- The employee’s vehicle is in a poor shop and is not properly maintained.
- The employee carries a below standard driving record.
- Business organization does not possess any plans for fleet control or policies to address usage of employee vehicles.
Read More Articles About Hired Auto Coverage:1) Impact of Coronavirus on Hired Auto Coverage or Non-Owned Auto Coverage
2) How to Buy the Right Hired Auto Coverage Insurance for your Needs?
3) The Things You Should Know About Hired Auto Coverage
Protect Your Business Against Many Liabilities with the Best Auto Coverage in Texas
SG Financial Inc. can provide you with the Best Hired Auto Coverage in Texas. A hired, or non-owned auto policy insurance protects your business. Do not allow a gap in coverage to leave your business assets at risk. Contact us today to discuss this important coverage.