Many businesses rely on employees to travel for work-related tasks using vehicles that the company does not own. Also, the business may need to rent a vehicle for business purposes. The unendorsed Commercial Auto Policy and Personal Auto Policy of the employee do not properly protect the employer. There is a gap in coverage, which is why we recommend Hired and Non-Owned Auto Coverage (HNOA)!
HNOA typically covers liability claims and defense costs if the business is sued as a result of an accident. These costs include attorney fees, settlements or judgments, and more. Social inflation can increase these costs significantly, making HNOA a smart coverage for many businessowners.
Non-owned autos are autos owned by an employee being used for the business, while hired autos are any vehicle that is hired, rented or borrowed for business use. Any time the employee is traveling on behalf of the business, there is a chance that an accident can occur while they’re on the clock.
COMMON EXPOSURES
• Employee drives to bank to make a deposit
• Salesperson drives to a customer’s location for a meeting
• Construction worker driving to and from job sites
UNCOMMON EXPOSURES
• Employee picks up lunch
• Employee is reimbursed to drive their own vehicle to business meetings, visit customers, pick up supplies or parts, etc.
• Employee ride shares for work related events
HNOA is priced and underwritten as excess coverage to a driver’s personal auto insurance. Typically the Personal Auto Policy (PAP) is primary and the HNOA policy is secondary. The PAP covers the driver of the vehicle, but not the business if the claimant sues. HNOA will provide protection for the business if the claimant sues.
We do require HNOA coverage be added to the Commercial Auto Policy if there is one in force with all drivers listed. Symbols 8 & 9 are added to the Commercial Auto Policy to add coverage.
About Symbol #8
Symbol 8 is for Hired “Autos” Only. Only those “autos” that an insured
leases, hires, rents or borrows. However, it does not include “autos” leased, hired, rented or borrowed from an employee, partner or member of an insured’s household.
About Symbol #9
Symbol 9 is for Non-Owned “Autos” Only. This symbol covers only those “autos” an insured does not own, lease, hire or borrow that are used in the insured’s business, including “autos” owned by employees, partners, or members of an insured’s household, but only while those non-owned “autos” are used either in the insured’s business or personal affairs.
HNOA SYMBOLS 8 & 9 COVER
Liability Claims, including personal damage to another person's vehicle
Bodily Injury and Medical expense if someone is injured in an accident
Legal expense if the named insured's business is sued for negligence
HNOA SYMBOLS 8 & 9 DO NOT COVER
REMINDERS FOR YOUR HNOA INSUREDS
• Be sure to run MVRs on employees driving their own vehicles.
• Ensure employee vehicles are in good working condition.
• Confirm that your employees have their own auto insurance policy in force.
For questions regarding HNOA coverage and details, be sure to contact your Commercial Underwriter today!
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