Your employee runs to the bank in her own car and causes an accident. Whose insurance pays?
Commercial auto · Updated September 2026
The employee's personal auto policy responds first, up to its limits. Those limits are often modest. When they run out, the injured party looks at the business, on the theory that the employee was acting within the scope of employment at the time — a doctrine that applies whether or not the business owns the vehicle.
Complicating it further, some personal auto policies limit or exclude coverage for business use, which can leave a thinner first layer than anyone expected.
Non-owned auto liability covers the business's liability arising from vehicles it does not own, including employees' personal cars used for company purposes. Hired auto covers vehicles the business rents or leases short term. The two are usually written together and are inexpensive relative to what they protect, because the coverage sits behind the driver's own policy.
It is liability coverage for the business. It does not repair the employee's car, and it is not a substitute for the employee carrying their own insurance.
Any business where employees run errands, make deliveries, visit customers, pick up supplies, or travel between job sites in their own vehicles. That covers a very large share of small businesses, including plenty that own no vehicles at all and therefore assume they need nothing.
It also applies to businesses that rent vehicles for travel or for temporary use during a busy season.
If employees drive their own cars for work, set a policy: require proof of personal auto insurance at a stated minimum limit, check motor vehicle records before allowing anyone to drive on company business, and re-check periodically. Document it. Those controls reduce both the chance of a claim and the premium.
Questions about your own situation? Call 417.623.8300 or send us your current policy. We are licensed in Missouri, Kansas and Oklahoma.
Questions about your own policy? Send it over and we will go through it with you.