Hired and Non-Owned Auto Liability (HNO) provides coverage for bodily injury and property damage to third parties resulting from an auto accident connected to your business.
Even if your business does not own a single vehicle, there are many situations where HNO can come into play.
· You rent a vehicle on a business trip.
· You send an employee out to pick up lunch or office supplies.
· Your salespeople drive their cars to a sales meeting.
The coverage is not meant to cover employees on their way to and from work. It is liability coverage for the Company in the event of an accident during the course and scope of the employee’s work.
In general, the employee’s insurance is primary and always follows the car, however, when injured third parties or their attorneys discover that the liable party for the accident was in the course and scope of work, YOUR COMPANY can become a big target, and HNO gives you a shield.
The good news is that Hired and Non Owned Auto is inexpensive coverage. Small business can add coverage for as little $80 annually.
On a commercial auto schedule Hired Autos are covered by “Symbol 8” and Non Owned autos are covered by “Symbol 9”. HNO is also covered in “Symbol 1” any auto.
If you rent vehicles for work often, you can avoid buying the Liability coverage option. You will still need to understand how your policy or company policy will react to physical damage to the rented vehicle, so purchasing the Collision Damage Waiver may be a smart idea as well.
*Risk management note: Make sure your HR team is checking to make sure that your employees that drive their own vehicle have the proper insurance.
-Martin Gill, Partner, Lee Insurance Services