I’ve worked in outside sales for nearly a decade, where both my current and previous employers provided company cars. It’s been standard practice to use these cars for personal use too—I even sold my vehicle when I first received a company car. Growing up, my mom also had a company car and only recently got a personal car upon retiring. I never thought I needed a personal auto policy until a recent conversation with an insurance agent. They informed me that I have no liability coverage in case of an at-fault accident while using the company car for personal reasons. I’ve checked with colleagues who also don’t own personal cars, and they confirmed they don’t have personal auto policies either. The agent clarified that I’m covered only for business use of the car. Is this correct?
That insurance agent is right. Company car insurance typically only covers business use, even if your employer lets you use it personally. This means you’d be on the hook for any damage or injuries caused by an accident while using the car for personal reasons. Scary, but common! Get your own personal auto policy ASAP. It protects you financially in case of an accident while using the company car for errands or fun. You can also check with your employer about optional add-on coverage for personal use on company vehicles
Depending on the policy, yes. However, if the company informs the agent, then utilizing it for personal use is covered. But since you’re not the named insured, you can’t allow someone else to drive it.
I’m not a fan of blanket statements like the one that the agent made without verification. The true answer depends on what the business auto policy says. There can be commercial auto policies endorsed for personal use. Most of us think of it going the other way—endorsing personal auto policies for commercial use—but it can be done the other way as well.
I’ll give her the benefit of the doubt and assume she was referring to scenarios where you might drive something else, like a rental or another car. In such cases, it would be wise to have a non-owner personal auto policy to cover use outside the company car. (There’s a specific term for these policies, but calling it a non-owner personal auto policy is an apt description.)
If you do get in a wreck in the company car during personal time, there may be some extra hoops to jump through. However, it ultimately comes down to what your company’s business auto policy is endorsed for.
Yes, the information provided by the insurance agent is generally correct. When you are using a company car for personal reasons, the coverage provided by the company’s insurance policy typically extends only to business use of the vehicle.
Company-provided insurance typically covers the vehicle for business use, including work-related travel and activities directly related to your job. This coverage is usually comprehensive for business purposes but may not extend to personal use unless explicitly stated.