What is hired auto coverage on a commercial auto policy?

1. What is the difference between owned, hired, and non-owned auto coverage?

Owned auto coverage applies to vehicles that are owned by the insured business, hired auto coverage applies to vehicles that are rented or borrowed, and non-owned auto coverage applies to vehicles that are used for business purposes but are not owned or hired by the insured.

2. Why is hired auto coverage important for a commercial auto policy?

Hired auto coverage is important because it provides protection for vehicles that are rented or borrowed by the insured business, ensuring that the business is covered in case of an accident or damage.

3. What does hired auto coverage typically include?

Hired auto coverage typically includes liability coverage, which covers damages to third parties, as well as physical damage coverage, which covers damages to the rented or borrowed vehicle.

4. Does hired auto coverage extend to employees driving rental or borrowed vehicles?

Yes, hired auto coverage usually extends to employees driving rental or borrowed vehicles for business purposes, providing coverage for the employee and the vehicle.

5. Is hired auto coverage required by law?

Hired auto coverage may be required by law in some states, so it’s important to check with local regulations and insurance requirements to ensure compliance.

6. Can hired auto coverage be added to an existing commercial auto policy?

Yes, hired auto coverage can usually be added to an existing commercial auto policy as an endorsement or add-on, providing additional protection for rented or borrowed vehicles.

7. What are some common exclusions to hired auto coverage?

Common exclusions to hired auto coverage may include vehicles that are not rented or borrowed for business purposes, vehicles used in illegal activities, or vehicles that exceed weight or size limits.

8. Are there any limitations to the coverage amount provided by hired auto coverage?

The coverage amount provided by hired auto coverage may be subject to limits and deductibles, so it’s important to review the policy details to understand the extent of coverage.

9. Can hired auto coverage be used for personal rental vehicles?

Hired auto coverage is typically intended for vehicles rented or borrowed for business purposes, so it may not extend to personal rental vehicles used for personal reasons.

10. How does hired auto coverage interact with primary insurance on a rental vehicle?

Hired auto coverage may act as excess insurance when a rental vehicle already has primary insurance, providing additional protection for the business in case of a claim.

11. Are there specific requirements for vehicles eligible for hired auto coverage?

Vehicles eligible for hired auto coverage must typically meet certain criteria, such as being used for business purposes, complying with state regulations, and being in good working condition.

12. Can hired auto coverage be customized to fit the needs of a specific business?

Hired auto coverage can often be customized to fit the specific needs of a business, with options to increase coverage limits, add endorsements, or tailor the policy to unique circumstances.

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