Verify Proper Coverage Is in Place for Your Company Car
Many employers provide employees company cars. Oftentimes, the employee
is told that he or she need not worry about the insurance issues for this
car; the employer will handle all of that. But this advice may be
shortsighted since coverage gaps can crop up that may impact the insured
employee in unforeseen ways. Thus, consider passing on the following tips to
your clients who may have company cars.
Since your employer provides you a company car, consider the following
risk management recommendations.
- Verify that corporate insurance is in place and that it
provides primary coverage. Also, check the liability limits
to confirm that they are adequate. Carefully adhere to any
restrictions on personal use, including possible
prohibitions of other drivers.
For company cars, the extended non-owned coverage—vehicles furnished or available for regular use (PP 03 06) or related endorsement can be
attached to your personal auto policy to provide excess liability coverage for these
types of vehicles. A key advantage of this endorsement is
its broad protection for co-employees.
- If you do not own an auto but do have personal auto exposure (e.g., company car, borrowing friends' cars, etc.), you should purchase a personal auto policy and attach a named non-owner coverage (PP 03 22) or related endorsement. Note that this endorsement could also be necessary if you need to purchase a personal umbrella policy.