California Property & Casualty Broker-AgentCasualty InsuranceEasy
A small business owner in California operates a landscaping company. They are purchasing a Commercial Auto Policy and want to ensure that if one of their employees uses their own personal vehicle for company business and gets into an accident, the company is protected from liability. Which endorsement or coverage would best address this specific concern?
- AHired Auto Coverage
- BGaragekeepers Coverage
- CNon-Owned Auto Coverage
- DDrive Other Car Coverage
Show answer & explanationAnswer & explanation
Correct answer: C. Non-Owned Auto Coverage
Non-Owned Auto Coverage provides liability protection for the business when an employee uses their personal vehicle for business purposes. This is a common exposure for companies whose employees occasionally drive their own cars for work.
Why the other options are wrong
- A. Hired Auto Coverage applies to vehicles leased, rented, or borrowed by the business, not employee-owned vehicles.
- B. Garagekeepers Coverage is for businesses that store or repair customers' vehicles, like auto repair shops or parking garages.
- D. Drive Other Car Coverage is typically designed for individuals (usually executives) who do not own a personal auto but drive company vehicles and occasionally borrow other cars.
Non-Owned Auto Coverage
Provides liability coverage for a business when its employees use their personal vehicles for company business.
- Covers the business's liability, not the employee's personal auto.
- Essential for businesses with employees who run errands or travel for work in their own cars.
- Typically added by endorsement to a Commercial Auto Policy or CGL.
Memory trick: Don't get caught without coverage when your team drives their own wheels for your deals!