Many business owners think just because they don’t own a vehicle, they don’t have any exposure to auto liability. Often, even businesses that do not own a vehicle need auto insurance, specifically hired and non-owned auto insurance.
Any time an employee is driving a vehicle, even their own, on “company time” or for a business purpose, the employer is exposed to liability. This is due to vicarious liability, the concept that one can be responsible for the acts of another. This is commonly referred to as the master/servant rule or respondent superior “let the master answer.” Because of this rule, employers are often responsible for the actions of their employees, even when the employer did not direct them to do something. If the employee drives their personal vehicle for a business purpose and is responsible for damage, the business is just as responsible. Cases are even more clear cut if the employee was in a vehicle rented primarily for business. For instance, when the employee is attending a conference and rents a vehicle.
The answer to this is hired and non owned auto insurance. For most small businesses, the insurance carrier writing the package policy or the “BOP” business owner’s policy, is happy to include the coverage. Most of the time, hired and non owned auto liability insurance is only a few hundred dollars per year, and is a worthwhile addition to your insurance program.
