In some companies, it makes no sense to use a company-owned vehicle by your employees. But this does not mean that the company does not have tasks that need to be managed. For example, let’s say you have a small jewelry store. If you’ve never traveled to meet clients, it might not make sense to own a company car for your employees to use. But you might still need an employee to head to your local office supply store to pick up paper, receipt tape, pens, and other essentials. For many companies, this means that employees will travel to an office supply store to run a business assignment in their personal vehicle.
If this employee had an accident in his personal car on the way to the job for your business, his personal auto insurance policy would cover much of the basic claim. But if the accident was their fault and the aggrieved party decides to file a lawsuit for damages, they can sue your business because the employee was working on behalf of your company at the time of the accident. In order to protect your business from the liability imposed by these potential claims, you can add automatic non-proprietary coverage in your business policy.
With Auto Non-Owned Coverage, you have a resource to cover property damage and liability claims that can arise from an accident that occurs when an employee uses their personal vehicle for work-related purposes. This type of coverage begins when the employee’s personal policy limits are reached and can protect your business assets from the claims of injured accident victims.
When you choose to add non-proprietary auto coverage in your company’s auto policy, that doesn’t quite mean you have it free for everyone in the event of employee accidents. Claims against your policy can increase your rates, so you should still try to organize the employees who manage your business tasks in their personal vehicles to help reduce the likelihood of accidents. For example:
• Manage and monitor your employees’ driving records so that you can only send the most responsible drivers on errands in their cars.
• Consider investing in a defensive driving course for employees who frequently run your tasks in their personal cars.
Avoid requiring younger and less experienced employees to run errands.
Between cautious behavior and proper insurance, you can protect your company from unnecessary and costly claims while still purchasing office supplies and running the small errands when you need them.