I’d like to talk today about hired and non-owned auto insurance coverage, which is a coverage often bypassed in the business insurance purchase.
It is not a stretch to imagine that small businesses run out of office supplies during the course of business. From toilet paper, to sticky pads, to highlighters, to light bulbs, and in the example I’m about to tell you, staples…
About a month ago at a local networking function, I stepped into a circle of six small business men and women. This was a new networking group for me so most of the members were not privy to my profession. As I stepped into this circle of professionals in all my insurance glory, (ready to get my network on), I heard a small business owner regale to a collection of his peers this tale of Insurance Horror and Conspiracy…But I Just Sent Her Out for Staples | (A Story of Hired and Non-Owned Auto)
The small business owner’s story was short, but it was the perceptions contained within the story that caught my attention. He started the story with the classic “Insurance is a scam“ rhetoric. His next point is what really bothered me. He said,
“How is anyone supposed to know this stuff?“
This is an extremely powerful statement that we will get back to.
In this story, this small business owner asked one of his employees, (a woman in this case), if she could pick up some staples on her way back from lunch. The office manager had accidentally forgotten to reorder the staples and the office had run out.
As fate would have it, this young lady got into an at-fault car wreck driving back to the office. Two cars were involved and there was approximately $30,000 in damages.
The employee mentioned to the other drivers that she was on an errand picking up staples from Office Max. The small business owner received a letter in the mail a few weeks later stating his organization could be sued for the damages.
He called his insurance agent… NO Coverage…
He did not purchase Hired and Non-Owned Auto coverage with his Business Owner’s Policy.
Moral: Always purchase Hired and Non-Owned Auto
Hired and Non-Owned Auto coverage provides liability insurance coverage arising out of the use or maintenance of a Hired or Non-Owned Auto and can easily and cheaply be endorsed to any business insurance policy (unless your business does deliveries then take out the Cheaply part).
Hired autos are autos the business leases, hires or borrows. Non-Owned autos are leased or borrowed by the insured, but used in business. This typically refers to an employee’s use of his personal auto for business purposes. Aha!
So, how is anyone supposed to know this stuff?
Have a dialogue and relationship with your independent insurance agent! Ask your agent where your business might have gaps in coverage. Discuss the cost to fill those gaps.
Never ever assume coverage. Trust your agent but do your due diligence…
That’s not to say that your agent shouldn’t be proactively looking out for your best interest as well. He should. That’s what we’re all about here at The Murray Group. We communicate openly and honestly up front to make sure your business is properly covered.
If we sound like an organization you’d like to do business with, give us a call at (518) 456-6688 or you can contact us by email here.