Employees using personal vehicles for business purposes run the risk of being faced with no coverage in the event of an accident.It is important for the employee and employer to understand the difference between personal and business use of the vehicle, and what steps each should take to ensure they are properly protected.

When an employee uses their own vehicle to travel from home to a regular job site or run personal errands during the course of the day, that is considered personal use of the vehicle and should not create an issue with the employee’s insurer in the event of an accident.

When an employee uses their own vehicle to travel from the office to a job site or to do work related tasks during the course of the day; that could be deemed business use of the vehicle, and there is a chance their insurance carrier could deny coverage.

Any employees using their own vehicles for business use should notify their insurance broker in order to make sure their vehicle is properly rated.

Many commercial business policies contain “non owned auto” coverage which protects the employer, not the employee. This is not coverage an employer can offer to use when the employee has an accident, but rather responds only when the employer is added to a legal action arising from an accident.

We recommend an employer insist on verification that the employees have advised their insurance broker that they are using their personal vehicle for business purposes.  This confirmation can be either by way of an email or letter from the employee’s insurance broker in order to make sure both the employer and employee are properly protected.

Should you have any questions regarding this topic, it is best to consult with your broker so you can “be sure”…