Business Car Rental Insurance Tips
HNO Automobile Coverage refers to Hired and Non-Owned Cars. The “Hired” Car is an automobile rented, while the “Non-Owned” car is an automobile not owned by the company – but is being used for company business. Whether your employees are driving a hired car, or driving their own cars while on a business trip, it is imperative to make sure that the company is properly insured to handle any accident.
HNO Automobile Liability
Hired and Non-Owned Automobile Liability will protect the company for 3rd party bodily injury and property damage when a suit is brought against the company.
An example: an employee backs either a rental car (Hired Auto) or their personally owned car (Non-Owned) that they are using for business into another car. This could happen in another state on a long business trip, or even in the parking garage! Either way, the HNO coverage would cover the OTHER car and if anyone was injured in that other car.
If that employee has their own policy in place, that is still not enough to protect the company – the HNO Coverage is in excess of the policy of the individual who rented the car. The company needs to make sure the individual has proper PRIMARY coverage for Property Damage and Bodily Injury.
How to Properly Rent a Car While on Business
When renting a car, the business must confirm that the employee is properly covered. If the employee has their own Personal Automobile Policy, the firm must make sure that the employee has proper limits of liability. The firm must also confirm that the employee has Physical Damage, Loss of Use and a Collision Waiver. This can be purchased at the rental counter or via a personal credit card. If you are renting a car without a personal auto policy and using your credit card*, purchase only the personal liability from the rental car company, and confirm that your credit card covers Physical Damage, Collision, and Loss of Use. If you do not have a personal credit card or a personal auto policy, you should purchase all of the insurance from the rental car company.
* Be careful with that credit card!
Pitfalls of renting by using credit cards include low physical damage sub-limits, “Loss of Use” not being covered, liability not being covered, and potentially large balances on your personal card, with a potential hit to your personal credit score. Make sure to read all of the fine print and discuss coverage before signing and swiping.
Evaluate and Discuss
It’s important to note that insurance policy forms vary greatly and a careful review of business policies is strongly recommended. Proper coverage can depend on whether the entity or the individual is renting the vehicle. The type of vehicle also should be reviewed. Contact your DG representative with any questions.