Staffing agencies often require temp workers to drive their own vehicles during the course of their employment. This may be either to run errands, or drive across town to report to an employer leasing their services. While most companies carry a policy to pay auto expense reimbursement for mileage, the company may be at risk if that employee is involved in an accident. Non-owned auto insurance coverage is usually added as an endorsement on a general liability policy.
This type of staffing agency insurance generally meets contract requirements for commercial auto coverage when a company has no vehicles titled in its own name. Otherwise, an employer will likely be held responsible for the actions of an employee who causes, or is the victim of an accident as a result of actions performed within the course of their employment.
Non-owned auto coverage protects the company
A policy for non-owned autos will aid the owners should they be sued due to an auto accident while one of their employees is on company business in a personal vehicle. Unlike a personal auto policy, this coverage is not designed to protect the individuals, owners, or employee in the event of an accident. As with hired auto coverage, this coverage protects the company only and supplements the driver’s personal auto liability coverage should the need arise.
For example, auto liability coverage may be described in the contract in the following way: “Contractor shall carry bodily injury, property damage, and automobile contractual liability coverage for owned, hired and non-owned autos with a combined single limit of liability for each accident of not less than $1,000,000.”
Your company’s liability for any on-duty auto accident
If a temp employee of the company inadvertently has a serious auto accident in their own vehicle, or in a rented vehicle while on company business, and their personal insurance is not enough to cover the claim, the claimant’s insurance company will likely hold the company responsible.
These claims can be catastrophic, and since the cost of non-owned auto insurance is minimal, it makes perfect sense to add this endorsement. Every business owner should seriously consider this coverage when purchasing staffing agency insurance policies as yet another important way to protect his or her assets.