With business auto insurance, customers often ask us how coverage works in certain situations. A couple examples would be when employees drive company vehicles for personal reasons or when they drive their personal cars for their job.
With most business auto policies, the coverage follows the vehicle. So if the employee has permission to use the business vehicle for personal reasons, coverage will typically be extended.
Using a personal car for work
If you’re a business owner and your employees use their personal cars for work, coverage is not provided automatically for you through a commercial auto policy. You would need to add hired and non-owned coverage to your policy, which would provide liability coverage if you are sued following an accident. The employee’s car insurance would usually cover the physical damage to the vehicle.
“The commercial auto coverage provides protection for your interests as the business owner, but the employee’s auto coverage may still be required to cover the claim,” says Leo Heintz, vice president and product manager, commercial auto insurance, at Erie Insurance.
Other ways business auto insurance can help protect you
For both owned and leased cars and trucks, business auto insurance offers coverage for:
- Damages if your car is damaged or destroyed by something other than an accident, such as theft, vandalism or hail when you purchase comprehensive coverage.
- Uninsured/underinsured motorists if an at-fault driver is unable to pay for damages associated with your injuries.
- Liability if you’re responsible for harming others or for damaging their vehicles or property.
- Medical costs for you or your passengers’ injuries as the result of an auto accident.