An employee may use a personal car to visit a client, pick up supplies, or make a delivery. A business may also rent a vehicle for a trip. Those uses create auto exposures that deserve a policy review. The California Department of Insurance commercial guide explains that a business auto policy can be arranged for owned, hired, and non-owned autos, depending on the coverage purchased and the covered-auto symbols shown on the policy.

In the October 13 Speaking of Insurance episode, Aaron Bollinger discusses business driving and employee-owned vehicles. This article focuses on policy questions raised by those uses, rather than guaranteed claim outcomes or prices.

What do hired and non-owned mean?

Hired autos generally refer to vehicles a business rents, hires, or borrows under the applicable policy wording. Non-owned autos generally include vehicles a business does not own, such as an employee's personal car used on company business. The exact definitions, covered-auto symbols, named insured, limits, and endorsements matter. Ask a broker to identify the symbols and terms on your issued policy rather than relying on a product label alone.

Does the employee's personal policy cover the trip?

There is no reliable universal answer. The National Association of Insurance Commissioners' small-business guide notes that personal and commercial auto coverage differ and that commercial policies may include employees' cars driven for company business. Whether an employee's personal policy responds depends on its wording and the actual use. The business may have its own liability exposure even if the driver's policy responds. Ask both insurers how a particular work use is classified and which policy responds first.

The California Department of Insurance lists automobile liability among the major exclusions in a commercial general liability policy. That makes it important to inspect the company's auto coverage instead of assuming the GL form covers a vehicle accident. A hired and non-owned auto option is generally about the business's liability exposure; it should not be assumed to repair an employee's car or replace the employee's own insurance.

What should a business check?

  • Which employees, owners, or contractors drive for business, and in which vehicles?
  • Does the company have a business auto policy, a package endorsement, or another arrangement? Which covered-auto symbols and limits apply to hired and non-owned autos?
  • Do rental agreements, delivery work, transporting people, or regular business use change the answer?
  • What do the drivers' personal policies say about the actual use, and what driver records or insurance evidence does the business collect?
  • Are physical damage for rented or employee-owned vehicles, defense costs, and any umbrella layer addressed separately?

Price depends on the insurer, class of business, driving exposure, limits, loss history, and policy structure. A single annual price cannot represent all California employers. Request a quote for the actual operation and compare it with the forms and limits you already carry. Ask Bollinsure to review your business auto setup if you want help identifying the relevant policy terms.

This is general educational information, not an individualized insurance recommendation or legal advice. Coverage and claim payments depend on the facts, issued policy terms and applicable conditions. A request or preliminary quote does not itself bind coverage.

Primary Sources and Further Reading