Company Cars and Personal Insurance

DHB Insurance | June 2011

Getting a company car can be one of the best benefits an employer can provide. It can also cause some coverage issues with your personal auto policy.

The standard NC auto policy (form NC0001 6/05) excludes coverage for non-owned vehicles furnished or available for your regular use. This can include a company car or any car you have regular access to. This does not even have to be one specific vehicle. The courts have ruled that if you have regular access to any of the vehicles owned by the company, the exclusion applies.

This means you are relying solely on the company's insurance for protection. If for any reason the company's policy does not respond, you have no coverage.

The company's business auto coverage will also not provide you protection if you use the vehicle outside the scope of the employers permission. This can leave a big gap if you or a family member use the vehicle in a way that wasn't part of the original agreement.

Here is an example. Your company gave you permission to use the car, but you are the only one allowed to drive it. If your spouse takes the company car to the grocery store, you have no coverage on either your policy or the company's policy.

This can be fixed by adding the Extended Non-Owned coverage endorsement to your policy for each member of your family. This will allow your policy's liability coverage to extend over vehicles furnished or available for your regular use.

This endorsement is inexpensive and can provide peace of mind. It is a good idea anytime you have regular access to a vehicle you do not own.

DHB Personal Insurance | Personal Insurance FAQ | Request a Quote or Ask a Question