If you carry a commercial auto policy, you may find the term hired auto liability included in the contract. In addition to the fleet of vehicles your company might own and operate for work purposes, such as the vehicles for the sales team or a car for administrative use, this portion of the policy extends coverage to any automobiles that your business may rent, borrow, or hire.
For a vehicle to qualify as a hired auto, the professionals at World Wide Speciality Programs caution that it must be leased, borrowed, rented, or hired but the entity or person list on the policy contract. The term named insured and the corresponding name listed on the vehicle rental contract must be the same for the coverage to apply.
What Doesn’t Qualify?
The extension of hired autos cannot be applied to any vehicles that involve a contract with your employees or with your partners. This means you cannot rent or lease or borrow a car from anyone that works for you, works with you, or is a family member in either of these categories. Generally speaking, the coverage for hired autos includes both physical damage and liability.
Instead of being surprised at a claim denial, should your or an employee get into an accident in a company vehicle, check with the wording of your commercial auto policy. If it’s not included, be sure to check with your agent about adding hired auto coverage.