Hired And Non-Owned Auto Insurance: How Much Coverage?

Hired and non-owned auto insurance (HNOA) is a type of insurance for small business owners who rent, lease, or borrow vehicles, or ask employees to use their personal vehicles for business purposes. It is a crucial form of protection for businesses that use vehicles they don't own, as it provides liability protection for personal, rented, and leased vehicles used for business purposes. HNOA can help cover property damage, bodily injury, and legal expenses resulting from accidents involving hired or non-owned vehicles. The cost of HNOA policies varies depending on factors such as the driver's profile, driving record, the number of employees, and the business's claims history. Basic coverage typically starts at around $7 a month, with premiums ranging from $120 to $170 per month on average.

Hired and non-owned auto insurance covers liability for property damage

Hired and non-owned auto insurance (HNOA) is a crucial form of protection for businesses that rent, lease, borrow, or use employee-owned vehicles for business purposes. It covers liability for property damage and bodily injury caused by an accident during business operations.

HNOA is a type of liability insurance that protects businesses financially if they are held responsible for an accident that results in property damage, injury, or death. It acts as secondary coverage, coming into effect when the limits of an employee's personal auto policy are exceeded or when an employee's insurance has lapsed. This means that the employee's personal auto policy is the primary policy in the claim.

HNOA covers two types of vehicles: hired vehicles, which are rented, leased, or borrowed for commercial purposes, and non-owned vehicles, which are employee-owned cars used for business-related activities. It is important to note that HNOA does not cover collision damage to the hired or non-owned vehicle and only provides third-party coverage.

The cost of HNOA depends on various factors, such as the number of employees, their driving records, the number of vehicles owned or hired, and the business's claims history. It is typically added as an endorsement to a commercial auto or general liability insurance policy, and the coverage limits are usually set at around $1 million.

HNOA is essential for small businesses that rely on vehicles they don't own or frequently send employees on work errands in their personal cars. It helps fill the gaps in insurance coverage and protects businesses from financial loss, liability, and possible bankruptcy in the event of an accident.

It also covers liability for bodily injuries

Hired and non-owned auto insurance (HNOA) is a crucial form of protection for small businesses that rent, lease, or borrow vehicles, or ask their employees to use their personal vehicles for business purposes. It covers the costs of any resulting lawsuits if you or your employee gets into an accident while driving a rented, leased, or personal vehicle for work.

HNOA provides liability coverage for bodily injuries caused by you or your employees while driving for work. This means that it covers the costs of treating another person's injuries caused by an accident you or your employee has caused. It also covers legal expenses if your business is sued. Some policies even provide compensation for lost time at work and a death benefit to cover funeral costs.

For example, if your employee drives their personal vehicle for work and rear-ends another car, your non-owned auto coverage can help pay for damages to the other person's vehicle if the costs exceed the employee's personal auto coverage limits. If they sue your business for medical costs later, this coverage can also help your company pay for those expenses.

HNOA is typically not available as a standalone policy. Instead, you can purchase it as a rider or endorsement for your commercial auto or general liability insurance, or as part of your business owner's policy. The cost of HNOA depends on various factors, including the driver's profile, driving record, the number of employees, and the number of vehicles your business hires or owns.

It does not cover vehicle repairs

Hired and non-owned auto insurance, also referred to as HNOA, is a type of insurance for small business owners who rent, lease, hire, or borrow vehicles, or ask employees to use their personal vehicles for business purposes. It covers vehicles that are not registered under the business' name, as commercial auto insurance only covers vehicles registered under the business' name.

HNOA is a relatively inexpensive form of protection, usually costing less than $150 a year, and can be added to a business auto policy or business owners' policy. It is not available as a standalone policy.

HNOA does not cover vehicle repairs or damage to the vehicle being driven, whether that is a leased, rented, or employee-owned car, van, or truck. This includes both physical damage and mechanical breakdown caused by normal wear and tear. It is therefore recommended that you and your employees also purchase physical damage rental car insurance or collision and comprehensive car insurance policies.

HNOA also does not cover:

• Accidents that happen while employees are commuting to work or running personal errands during the workday.
• Stolen items from the hired vehicle.
• Hit-and-run accidents.

It can be purchased as an add-on to general liability insurance

Hired and non-owned auto insurance (HNOA) is a crucial form of protection for small businesses that rent, lease, or borrow vehicles, or ask their employees to use their personal vehicles for business purposes. It is not usually offered as a standalone coverage but can be purchased as an add-on to general liability insurance.

HNOA is a secondary form of protection, with the primary policy being the driver's personal auto policy. However, personal auto policies often have lower limits that can be exhausted quickly, and the insurance company may refuse to cover a claim if the driver was using their vehicle for business purposes. This is where HNOA comes into play, providing additional protection for your business.

HNOA acts as a form of liability car insurance, protecting your business financially if you or your employees are legally responsible for an accident that results in another person's injury, death, or property damage. It covers legal expenses and compensates third parties for their losses. It does not cover damage to the vehicle involved in the accident or any injuries sustained by the driver or employees.

HNOA can be added as an endorsement to your general liability insurance policy, providing liability protection when you or your employee is using a rented, hired, or borrowed vehicle for business purposes. It is an important add-on as it protects your company's finances if someone sues over an incident.

The cost of HNOA depends on various factors, including the driver's profile, driving record, the number of employees, the number of vehicles hired or borrowed, and the business's claims history. However, it is generally affordable, with average premiums ranging from $1,440 to $2,040 per year.

It is not available as a standalone policy

Hired and non-owned auto insurance, also known as HNOA, is a type of insurance for small businesses that rent, lease, or borrow vehicles, or whose employees use their personal vehicles for business purposes. It is designed to protect businesses from financial losses in the event of an accident involving a non-owned or hired vehicle.

HNOA insurance is typically not available as a standalone policy. Instead, it is usually offered as an add-on to an existing commercial auto or general liability insurance policy, or as part of a business owner's policy (BOP). This means that businesses cannot purchase HNOA as a separate, independent insurance coverage.

The reason HNOA is not available as a standalone policy is that it is intended to provide secondary coverage. In the event of an accident, the primary insurance policy is the driver's personal auto policy. However, the coverage limits of personal car insurance policies are often lower than those of commercial auto insurance. This is where HNOA comes into play—it provides additional protection if the costs of an accident exceed the limits of the primary policy.

By purchasing HNOA as an add-on to their existing policies, businesses can ensure they have adequate coverage for any incidents involving hired or non-owned vehicles. This can be especially important for small businesses that frequently rent or lease vehicles or rely on their employees' personal vehicles for business operations.

HNOA provides liability coverage for property damage and bodily injuries caused by the policyholder or their employees while driving for work. It is important to note that HNOA does not cover repairs or damage to the hired or non-owned vehicle involved in the accident.

Frequently asked questions