Auto Insurance for Contractors: Hired, Non-Owned and Fleet Insurance

Does your business often rely on employee’s using their personal vehicles for work-related activities, such as traveling from one job site to the next or picking up supplies?

While your employee’s personal insurance should provide coverage in the event of a crash during these trips, you as the business owner may also be liable if the business was deriving a benefit from the travel.

Whether your company owns its own vehicles, or your contractors use personal vehicles for business, providing the appropriate insurance coverage is crucial. Below are commercial insurance options to weigh for your company needs.

Related Resource: Promote Defensive Driving

Company-Owned Vehicle Options

If your vehicles are registered in your company name, you will need to purchase commercial auto insurance. While commercial auto insurance is more expensive than personal insurance, it offers more coverage for your drivers.

You can obtain commercial auto insurance for a single vehicle or fleet, depending on your needs. Be aware that your rate is based on the entire group of drivers, so one driver with a flawed driving record could increase your premiums. Costs also vary based on vehicle types, value, average mileage and location.

Related Resource: Business Vehicle Insurance

Non-Owned Vehicle Options

While many small businesses don’t own company vehicles, they often need to use others’ vehicles to run errands, make deliveries or take a business trip. This is where non-owned or hired auto insurance comes into play. While both fall under a commercial auto policy, they should be used in addition to personal auto insurance.

Both of these types of policies protect your employees when they are held liable for an accident. However, each should be considered individually, as both provide unique coverage options for your company’s needs.

Non-Owned Auto Insurance

This type of insurance covers non-owned, non-hired vehicles that you rent or hire from employees, partners or members. If your employees occasionally use personal vehicles for business and find themselves in an accident, they could walk away with damages that their personal auto insurance will not cover.

Hired Auto Insurance

This type of insurance provides coverage for vehicles that are rented, leased, borrowed or hired, similar to non-owned coverage. However, unlike non-owned insurance, this does not include vehicles rented, leased, borrowed or hired by your employees, partners or members.

Related Resources: Insuring Hired and Non-Owned Autos

As you consider your insurance needs, take a look at some of your contractor insurance options, including a signature series or a package program. Want to learn more?