Can I Cover My Company Vehicle with My Personal Auto Policy?

Company vehicle under auto insurance policy


Some jobs involve driving company vehicles, while others allow workers to drive their own vehicles for work-related tasks. Is it possible to use a car provided by your employer for both business and personal needs? Yes, but you will have to provide your own coverage for your personal use. In that scenario, here’s a look at what you need for insurance coverage.

Using Your Personal Insurance for Your Company Car

A commercial auto insurance policy usually has a little-known exclusion that the plan doesn’t cover the personal use of a company vehicle. That means employees will have to use their own personal auto policy for commercial vehicles furnished to them if they are involved in a traffic accident outside of work.

Usually, the employer’s commercial auto policy protects company drivers if they encounter an accident on the job. However, any driving that’s unrelated to work is considered separate and must be covered by the driver. Since the terms and conditions stated in an insurance policy can appear complex, it’s important to review them with your insurer to make sure you understand them.

Adding an Endorsement to Cover Personal Use

The solution for the driver who gets to take home a company car is to add an endorsement to their existing personal auto insurance plan. The name of this coverage is Extended Non-Owned Coverage for Named Individuals. Anyone else in the household who drives the vehicle should be listed on the endorsement as well.

This endorsement only covers liability, which means it pays for accidents that the driver causes to others. The employer’s insurance policy may allow for an extended non-owned endorsement. If not, the employee will need additional coverage to fill the gap to cover physical damage to the vehicle. One option is to add a Named Non Owned policy to their coverage.

When you drive a company vehicle as your regular transportation and then borrow someone else’s car, there’s no coverage. However, if your employer adds a Drive Other Car Coverage endorsement, it will be covered. Another option is to purchase a Named Non Owner Policy for yourself.

Many jobs allow employees to use company vehicles when they want and even take them home if necessary. Nonetheless, it’s common for supervisors not to discuss with employees what the insurance covers. It raises questions when employees enjoy this freedom then wind up in an accident during off-work hours.

Employers need to think ahead about potential claim issues before turning the keys to vehicles over to employees. If employees are allowed to take company vehicles home, the insurance company should have their name listed in the policy.

It’s important for business owners to know how commercial auto insurance works. The idea of a personal auto policy for commercial vehicles is complex in the sense you may need backup coverage to fill coverage gaps. Contact us here at Chambers & Company Insurance Brokers for more information about implementing the right personal or commercial auto insurance plan for your needs.

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