Hired and non-owned auto coverage is often added as an endorsement on a general liability insurance policy.   This is typically inexpensive coverage and should always be purchased when available.

A supplemental coverage option, Hired Auto coverage provides liability coverage for the company of an employee driving a vehicle rented in the company name while on company business. It does not cover physical damage to the vehicle, nor does it cover any injury to the employee. Unless your company rents vehicles with a credit card that includes vehicle physical damage coverage, you should always purchase that coverage when offered by the rental company.

Non-owned Auto liability coverage protects the company should it be sued if an employee gets in an accident while driving their vehicle on company business. This type of insurance only responds when the employee’s insurance is inadequate to pay the claim and the company is sued.  The employee still has primary liability responsibility and this coverage will not directly protect the employee at all.

Companies that have employees who rent vehicles on company business should establish clear procedures regarding which rental companies are used and which coverages and amounts of coverage employees should purchase from the rental company.  When company employees drive their vehicles on company business, the company should require that they carry at least $100,000 in personal auto liability coverage.    It is also important that companies obtain annual driving record reports from the state for all employees who drive on company business and restrict drivers with poor driving records.