Non-Owned and Hired Auto Liability insurance Coverage

Why are Non-Owned and Hired Auto Liability insurance so important?
Commercial Hired and Non-Owned Auto Liability Insurance (HNOA) is a crucial form of protection for businesses that utilize vehicles not owned by the company. These can include rented (hired) or employee-owned vehicles (non-owned) used for business purposes. It serves as a safety net, safeguarding your business from significant financial losses that may arise from accidents involving these vehicles.

Do I have an exposure?
You may think you don't have these exposures, but most businesses do. Here are some examples: Your employee uses their own vehicle to run an errand for your business, such as going to the bank to make a deposit, picking up lunch for the office, or making deliveries. If the employee is involved in an accident while conducting your business you, as the business owner, have a non-owned auto exposure. If a business rents a vehicle for its employees for business activities and an accident occurs while using the rental car, it poses a hired auto liability exposure.

What does HNOA cover?
HNOA insurance covers liabilities related to bodily injuries, property damages, and legal defense costs to protect you only from accidents involving hired or non-owned
vehicles. However, it doesn't cover physical damages to the vehicle itself. That's where hired auto physical damage insurance comes in to ensure comprehensive protection.

Common Misconceptions:
A common misconception is that personal auto insurance policies of employees can provide sufficient coverage in case of an accident. But personal auto policies may not cover accidents that occur during business-related trips, and even if they do, the coverage may not be sufficient to handle significant claims.

What's the downside of not having HNOA?
Not having HNOA insurance could lead to substantial financial implications for a business. In the event of a severe accident involving a hired or non-owned vehicle, a business could be held liable, potentially resulting in hundreds of thousands, if not millions, in settlement fees. These substantial costs could destabilize a business or even lead to bankruptcy.

What's the takeaway?
Investing in HNOA insurance is an efficient way to manage these risks. The cost of the policy is typically based on factors like the number of vehicles used, the extent of usage, driving records of the employees, and the business's industry type. The cost of HNOA is nominal compared to what it can cost your business should you sustain a loss without coverage.

Please contact us now to help you identify your business's specific needs and budget.

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