Hired & Non-Owned Auto Insurance

What Is Hired & Non-Owned Auto Insurance?

Hired and non-owned auto insurance is a commercial coverage that protects your business from liability when employees drive vehicles not owned by your company. Our insurance agents help businesses understand this often-overlooked coverage that fills critical gaps in commercial auto policies.

Hired auto coverage applies when your business rents or leases vehicles for company purposes. This includes rental cars for business trips, temporary equipment rentals with vehicles, or any borrowed vehicles used for work activities. If an employee causes an accident while driving a rental car on company business, your hired auto coverage responds.

Non-owned auto coverage protects your business when employees use their personal vehicles for work-related tasks. Whether they're running errands, visiting clients, attending meetings, or making deliveries, their personal auto policy is primary. However, if their coverage limits are exhausted or if your business is named in a lawsuit, your non-owned auto insurance provides additional protection.

This coverage is particularly valuable because most commercial general liability policies exclude auto-related accidents. Standard commercial auto policies only cover vehicles your business owns. That leaves a significant gap when employees drive their own cars or rental vehicles for work purposes.

What Does Hired & Non-Owned Auto Insurance Cover?

Understanding what this policy covers helps you determine if your business has adequate protection. Hired and non-owned auto coverage primarily provides liability protection when employee-driven vehicles cause accidents during business activities.

Bodily Injury Liability

Your policy covers medical expenses, rehabilitation costs, and legal fees if an employee causes an accident that injures someone else. This includes pedestrians, other drivers, passengers, or anyone harmed in the accident. If the injured party sues your business, the policy covers legal defense costs and any settlements or judgments up to your policy limits.

Property Damage Liability

When an employee driving a personal or rental vehicle damages someone else's property during work duties, your coverage responds. This includes damage to other vehicles, buildings, fences, equipment, or any other property. Your policy pays for repairs or replacement costs along with associated legal expenses.

Legal Defense Costs

Even when you're not at fault, defending against lawsuits is expensive. Your hired and non-owned auto insurance covers attorney fees, court costs, and related legal expenses. These costs are typically covered in addition to your policy limits, not deducted from them.

What's Not Covered

This policy does not cover physical damage to the rental or personal vehicle itself. That's the responsibility of the rental car company's collision damage waiver or the employee's personal auto insurance. Your policy also doesn't cover intentional acts, criminal activities, or employees using vehicles outside the scope of their employment. Workers' compensation typically covers employee injuries, not hired and non-owned auto insurance.

How Much Does Hired & Non-Owned Auto Insurance Cost?

Your premium depends on several business-specific factors that insurance carriers evaluate when determining rates. Understanding these factors helps you anticipate costs and identify ways to potentially lower your premium.

The number of employees who drive for business purposes significantly impacts your cost. More drivers mean more exposure to potential accidents. Carriers also consider how often employees drive and the distances they typically travel. A business with occasional business trips will pay less than one where employees are constantly on the road.

Your industry and business operations matter considerably. Real estate agents who regularly drive clients to properties face different risks than office workers who occasionally attend off-site meetings. Carriers assess your specific business activities to determine appropriate pricing.

Coverage limits you select directly affect your premium. Higher limits provide more protection but cost more. Most businesses carry limits of $1 million per occurrence, though some industries or contracts require higher amounts. Your deductible choices also influence pricing, though many hired and non-owned policies have no deductible for liability coverage.

Your claims history plays a role in determining rates. Businesses with previous auto-related claims typically pay more than those with clean records. The geographic areas where your employees drive also matter, as accident rates and litigation costs vary by location.

Many carriers offer this coverage as an endorsement to your commercial general liability or business owner's policy, which can be more cost-effective than purchasing standalone coverage. Bundling multiple policies with one carrier often results in better rates. Working with an independent agency lets you compare quotes from multiple carriers to find competitive pricing for the coverage your business needs.

Do I Need Hired & Non-Owned Auto Insurance?

If employees ever drive for work purposes in vehicles your business doesn't own, you likely need this coverage. Many business owners mistakenly assume their general liability policy or employees' personal auto insurance provides adequate protection. Unfortunately, that's rarely the case.

Your business needs hired and non-owned auto coverage if employees use personal vehicles for work tasks like visiting clients, running errands, attending meetings, picking up supplies, or making deliveries. Even if it happens occasionally, the liability exposure exists. One serious accident could result in a lawsuit that threatens your business assets.

Companies that rent vehicles for business purposes need hired auto coverage. This includes rental cars for business trips, temporary vehicle rentals during peak seasons, or leased vehicles for short-term projects. The rental company's insurance typically has low limits and may not fully protect your business interests.

Professional service businesses often require this coverage. Real estate agents, consultants, sales representatives, home healthcare workers, and service contractors frequently drive to client locations. If you operate a business where employees leave the office to meet clients or perform services, you need this protection.

Some contracts and client agreements mandate hired and non-owned auto insurance. Many companies won't work with vendors or contractors unless they carry this coverage. Landlords may require it from property management companies. Commercial leases sometimes include it as a condition of occupancy.

Businesses without company vehicles especially need this coverage. If you don't own commercial vehicles, you might think you don't need commercial auto insurance. That's partially true, but hired and non-owned coverage fills the gap. It's specifically designed for businesses whose employees drive vehicles the company doesn't own.

How to Get Hired & Non-Owned Auto Insurance in Utah

Utah businesses face specific considerations when securing hired and non-owned auto coverage. Understanding state requirements and local insurance market conditions helps you make informed decisions about protecting your business.

Utah law requires minimum liability coverage for all vehicles operated in the state, including rental and personal vehicles used for business. While Utah doesn't specifically mandate hired and non-owned auto insurance for businesses, the liability exposure remains significant. If an employee causes a serious accident while driving for work, your business could face substantial financial consequences without proper coverage.

The process starts by evaluating your actual exposure. Document how many employees drive for business purposes, how frequently they drive, and what types of activities involve vehicle use. This information helps insurance carriers accurately assess your risk and provide appropriate coverage recommendations.

Most Utah insurance carriers offer hired and non-owned auto coverage as an endorsement to commercial general liability policies or business owner's policies. This approach is typically more affordable and convenient than purchasing standalone coverage. However, businesses with significant driving exposure might need higher limits or separate policies.

Working with an independent insurance agency provides significant advantages. Independent agents represent multiple carriers, allowing them to compare coverage options and pricing across different insurance companies. They understand Utah's insurance market and can identify carriers that specialize in your industry or business type.

When requesting quotes, be prepared to provide information about your business operations, number of employees, estimated annual mileage for business driving, and your desired coverage limits. Carriers may also ask about your claims history and current insurance coverages. Accurate information ensures you receive appropriate quotes and avoid coverage gaps.

Get Your Free Hired & Non-Owned Auto Insurance Quote

Protecting your business from liability when employees drive personal or rental vehicles is essential. Don't assume existing policies cover these risks. The Insurance Center makes it easy to find the right coverage at competitive rates.

Since 1995, we've helped Utah businesses secure comprehensive insurance protection. As an independent agency, we shop multiple top-rated carriers to find coverage that fits your specific needs and budget. We take time to understand your business operations and recommend appropriate coverage limits.

Contact our team today for a free hired and non-owned auto insurance quote. We'll review your current coverage, identify potential gaps, and provide personalized recommendations. Get the protection your business needs with the service you deserve.