When I first met David Dickie at a home care conference, I was immediately struck by David’s laid back demeanor and his deep knowledge of the insurance industry. His insurance company, The Solutions Group, underwrites policies directly with the Lloyds of London, cutting a number of intermediaries usually found in the insurance world. This direct insurance approach secures affordable yet comprehensive coverage.
Here’s a scenario to illustrate the risk: an employee drives a client to an appointment and hits a pedestrian. The pedestrian dies and the client is injured; the employee is at fault. The dead pedestrian’s family hires a smart attorney who then sues both the employee and the employer for damages sustained. The client also sues for damages. You now have a non-owned auto claim.
Assuming that the employee was driving his/her own vehicle, which insurance policies are in play, and in what order?
- The employee’s auto policy is always the first in line for liability, AND IS THE ONLY POLICY THAT WILL FIX THE EMPLOYEE’S CAR.
- After the limits of liability on the personal auto policy are exhausted, the non-owned auto liability policy takes over. Most non-owned auto policies are written on a duty to defend policy form, which means that the insurance company provides the defense attorneys and manages the claim from beginning to end.
Non-Owned auto liability insurance is designed to protect for the risk of having employees drive their own vehicles, or a client’s vehicle, on company business. The best time to clarify your auto insurance protection is prior to an accident, not when the vehicle is a smoking wreck and the opposite party is looking for ways to avoid paying the claim.
Home care executives need to address to the following points:
- Make sure that caregivers’ auto insurance extends to incidental transportation for a work purpose. Employees must contact their insurance company and let them know the extent of their on-the-job driving. Some insurance companies will require a business use rider, which will specifically endorse the policy for incidental business use of a personally owned vehicle.
- Protect against employees suing your agency for unpaid personal auto insurance claims. Share this information with employees upon hire. As long as you can show that employees were notified, you should be protected against a liability claim filed by an employee
- Confirm that your liability insurance package includes non-owned auto coverage. Typically coverage is added by endorsement to a general liability policy. Non-owned auto claims do not happen very often, but when they do they tend to be large.
- Be certain that you are complying with your insurance company’s requirements for non-owned auto. Most insurers require a DMV check of new hires for records of accidents and traffic violations. Ask your broker what the requirements are for your particular insurance company.
The Solutions Group specializes in the home care market. They understand the business and its risks. When caregivers drive as part of their job duties, having the proper level of insurance is essential when accidents happen. For more information on insurance products and services offered by The Solutions Group go to their website: www.homehealthins.com
