Automobile Insurance

Extended Non-Owned Liability Coverage

.Should you have Extended Non-owned Liability Coverage added to your Personal Auto Policy? This endorsement removes the furnished auto exclusion (and a few others) from your Personal Auto Policy, giving you excess liability protection when operating a non-owned auto that is furnished for your regular use, such as company car or truck. With a dramatic increase in litigation by fellow employees for injuries caused in accidents involving employers autos (something not covered by most Business Auto policies insuring these autos) this coverage has become a must for anyone operating company or employer provided autos.

At the same time, many larger employers have taken steps to reduce their liability for employee use of autos by drafting very specific policies on employee auto use. Employees are often directed not to transport others, not to use the auto for personal purposes, not to operate an auto under the influence of alcohol or drugs, etc.

Most Business Auto policies only extend liability protection to the employee when they are using the employers auto with the employer’s permission. The question then arises, whether or not the employee would be covered when they use the auto outside the scope of their employers permission. As an example, you are furnished a company car, but the company has a policy against drinking and driving. You are on your way home from the golf course one afternoon, after consuming 3 beers afterward in the clubhouse and have an accident. Your employer’s automobile insurance carrier may deny to pay any damages on your behalf because you were using the car outside of the permission granted. What constitutes "permission" seems to vary widely by state.

The bottom line is that if you are furnished a company vehicle, it is prudent to purchase Extended Non-Owned Auto coverage to make sure you are fully protected.

If you have a non-owned vehicle available for your regular use, give your agent a call to discuss the cost and availability of this valuable coverage.