In some companies, a company-owned vehicle for use by their employees simply doesn’t make sense. But that doesn’t mean the business never has errands to run. For example, let’s say you own a small jewelry store. If you never travel to meet clients, it may not make sense to have a company vehicle for your employees to use. But you may still need an employee to run to the local office supply store to pick up paper, receipt tape, pens, and other basic supplies. For many businesses, that means employees will travel to the office supply store to run a business errand in their personal vehicle.
If that employee is in an accident in his personal vehicle on his way to run this errand for your business, his personal auto insurance policy will cover much of the basic claim. But if the accident is his fault and the injured party decides to sue for damages, he could sue his company since the employee was away on behalf of his company at the time of the accident. To protect your business from liability imposed by these potential claims, you can add non-owned auto coverage to your business policy.
With coverage for autos you don’t own, 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 business-related use. This type of coverage kicks in when the employee’s personal policy limits are reached and can protect your company’s assets from claims by injured accident victims.
When you choose to add non-owned auto coverage to your business auto policy, that doesn’t exactly mean you have full employee accident coverage. Claims against your policy could increase your rates, so you should still try to regulate employees who run business errands in their personal vehicles to help reduce the likelihood of accidents. For example:
• Manage and control your employees’ driving records so you can send only the most responsible drivers on errands in their cars.
• Consider investing in a defensive driving course for employees who frequently run errands in their personal vehicles.
• Avoid asking younger, less experienced employees to run errands.
Between careful behavior and proper insurance, you can protect your business from costly and unnecessary claims while you shop for your office supplies and run small errands when you need them.