Hired and non-owned auto insurance

Hired and non-owned auto (HNOA) insurance is a type of liability coverage that provides protection when vehicles your business doesn't own are used for work purposes, including:

• Hired vehicles, such as rented or leased cars used for business errands or travel
• Non-owned vehicles, like an employee’s personal car used to run a work-related errand

If someone is injured or their property is damaged in an accident involving one of these vehicles, HNOA insurance can help cover legal fees, medical bills, and settlement costs.

With HNOA insurance, it's important to understand that it covers your business’s liability and not damage to the vehicle itself or the driver’s injuries. Typically, this coverage is added as an endorsement to a general liability policy or business owner’s policy (BOP), giving small business owners an affordable way to close a common coverage gap.

Even if you don’t own a company vehicle, your business can still be held liable for accidents that happen while work is being done. That risk often surprises small business owners, especially those who rely on rented cars or employees’ personal vehicles to get the job done.

A single accident can lead to expensive lawsuits, particularly if there are injuries or significant property damage. Without the right coverage in place, those costs may have to come out of your business’s pocket, putting your finances and future at risk.

There’s also a common misconception that a personal auto policy will fully protect you in these situations. In reality, coverage is often limited when a vehicle is being used for business purposes, which can leave a costly gap.

Hired and non-owned auto insurance helps fill that gap, offering an extra layer of protection so you’re not exposed to unexpected legal and financial setbacks.

Hired and non-owned auto insurance provides financial protection if you get into an accident in your own vehicle, an employee vehicle, or a hired auto used for business.

Specifically, HNOA insurance covers:

Most small business owners add hired and non-owned auto coverage to their general liability insurance or their commercial auto insurance policy as an endorsement, which helps save money on coverage. However, some carriers sell HNOA as a separate policy.

If your business has higher-than-average liabilities, such as a fleet of non-owned vehicles, you can increase your coverage limits with commercial umbrella insurance. Umbrella insurance boosts your maximum policy limits, meaning your insurance company will cover more expensive lawsuits.

Hired and non-owned auto insurance benefits a wide range of small business owners who depend on personal, leased, or rented vehicles to conduct business.

You might consider an HNOA insurance policy if:

Small businesses often need this coverage without realizing it. You might not think it’s a big deal to occasionally ask employees to use their own vehicles for work errands. But if they get into a car accident, their personal auto insurance provider might deny the claim.

For example, an employee rear-ends an SUV while driving their own car to meet a client. The other party sues to recoup their medical expenses, but the employee's personal insurer denies the claim since the accident happened while they were driving for work.

If you're an independent contractor or otherwise self-employed, your personal auto insurance won't provide protection for work-related auto accidents. HNOA insurance would provide coverage when you need to drive your own vehicle for work purposes.

If your business rents trucks, vans, or other vehicles, or operates under a trucking contract, HNOA insurance would provide coverage for your rented vehicles.

For example, if you or an employee is involved in an accident while making a delivery in a rental truck, HNOA insurance would cover the cost of a lawsuit or any damages.

While hired and non-owned auto insurance does provide coverage for bodily injury and property damage liabilities, it does not provide all the protection that a small business might need.

For instance, an HNOA policy does not cover:

Most small businesses are eligible for hired and non-owned auto insurance, especially if they:

• Have employees who sometimes drive their personal vehicles for business-related tasks
• Rent or lease vehicles for short-term business use
• Don’t own company vehicles but still have any work-related driving exposure

HNOA coverage can typically be added to a general liability, BOP, or commercial auto policy, making it a flexible option for many types of small businesses, including:

• IT professionals visiting client sites
• Videographers traveling to shoots
• Landscapers running transporting equipment
• Handymen picking up materials

If driving is part of how you get work done—even occasionally—there’s a good chance your business is eligible and could benefit from this coverage.

Personal auto insurance is designed for everyday driving, like commuting or running personal errands. It typically offers lower coverage limits and may not fully apply when a vehicle is used for business purposes.

Hired and non-owned auto coverage helps fill that gap. If you or your employees are involved in an accident while using a personal or rented vehicle for work, HNOA can provide an added layer of liability protection for your business.

In many cases, HNOA acts as a form of excess coverage, meaning it can step in after a personal auto policy reaches its limits or doesn’t cover a claim due to business use. This helps protect your business from out-of-pocket costs like legal fees, settlements, or judgments.

If you regularly use a personal vehicle for work, relying on personal auto insurance alone could leave you exposed—making HNOA an important safeguard for your business.

HNOA insurance limits can be defined as the maximum amount of money your insurance company will pay for a claim. These limits are set when purchasing your HNOA endorsement and often match the limits of your general liability policy or commercial auto policy.

Among Insureon policyholders, the average limit for auto insurance policies is $1 million.

It can take several weeks for a traditional insurance agency to send a certificate of insurance (COI) to new customers. That’s an issue for business owners who need immediate proof of coverage.

With Insureon, you can typically download a COI the same day that you apply for quotes, so you can send proof of insurance to banks and lessors, and use your vehicle right away.

Small business owners can extend their HNOA coverage to subcontractors and other individuals with additional insured endorsements.

For example, a business hires a contingent worker through a staffing agency to assist with a temporary employee shortage. The business could add an endorsement to their HNOA policy that would allow the temporary employee to drive their own car or a rental car for work for a fixed period of time.

A temporary substitute automobile is a vehicle that is used while your insured car is unavailable for a short period of time. A common example of this is when an auto repair shop provides a loaner vehicle for customers who are waiting for their own car to be repaired.

If you're on the road with a temporary vehicle while using it for business purposes, your HNOA and personal auto policy would not provide coverage. Any expenses from an accident would be your responsibility.

If you plan on regularly using temporary substitute vehicles, you may want to consider a business auto policy (BAP) which covers all vehicles used by your business and your employees, including temporary substitutes.

You can find additional information about this policy in our FAQs about hired and non-owned auto insurance.

If you have any other questions about coverage or building your risk management plan, you can contact an Insureon agent.