If employees ever drive their own cars or rental vehicles for work, your business could be exposed to liability. Hired and non-owned auto coverage helps protect Santa Ana businesses when accidents happen during work-related driving.
A Common Situation Many Businesses Overlook
Many Santa Ana business owners assume that auto risk only exists if the company owns vehicles. In reality, auto liability can arise even when you don’t own a single car.
Consider these common situations:
- An employee uses their personal car to drop off paperwork
- A staff member rents a car while visiting a client
- A manager drives their own vehicle to a conference
If an accident happens during one of these errands, your business can still be named in a lawsuit.
That’s where hired and non-owned auto coverage comes in.
What Is Non-Owned Auto Coverage?
Non-owned auto coverage helps protect your business if it is sued due to an accident involving an employee’s personal vehicle used for business purposes.
Example
An employee uses their personal car to run a company errand and causes an accident that injures another driver. The injured party sues both the employee and your business. Non-owned auto coverage may help with liability costs tied to the business.
What Is Hired Auto Coverage?
Hired auto coverage provides liability protection for vehicles your business rents, hires, or borrows for short-term business use.
Example
Your employee rents a car while traveling to meet a client and causes an accident. Hired auto coverage may help cover the business’s liability for injuries or property damage to others.
Why These Coverages Are Important for Santa Ana Businesses
Even small businesses in Santa Ana often rely on:
- Employee vehicles
- Rental cars
- Short-term borrowed vehicles
Without hired and non-owned auto coverage, businesses may face:
- Out-of-pocket legal costs
- Gaps between personal auto policies and business liability
- Contract compliance issues with clients or vendors
These coverages are commonly added as endorsements to a general liability policy or commercial auto policy.
What Hired and Non-Owned Auto Coverage Typically Helps With
These policies are a form of liability insurance and may help cover:
- Property damage to a third party’s vehicle
- Bodily injury and medical expenses for third parties
- Legal defense costs, settlements, or judgments
What These Coverages Do NOT Cover
It’s equally important to understand their limits. These policies generally do not cover:
- Damage to the rented or personal vehicle itself
- Medical bills for your employee or yourself
- Accidents during personal (non-business) driving
Knowing these limits helps set proper expectations and avoid surprises.
Do You Need Hired and Non-Owned Auto Coverage?
Your business should strongly consider this coverage if:
- Employees use personal vehicles for work
- You rent cars or vans for business travel
- You don’t own company vehicles but still have auto exposure
- Client contracts require auto liability coverage
In many cases, hired and non-owned auto coverage helps meet commercial auto insurance requirements even when no vehicles are titled to the business.
Why Local Guidance Matters
Every business operates differently. Coverage needs vary based on:
- Industry
- Number of employees
- Frequency of driving
- Contractual requirements
That’s why understanding how hired and non-owned auto coverage fits into your overall insurance plan is essential.
How Neighborhood Insurance Agency Can Help
Established in 1989, Neighborhood Insurance Agency is a trusted local provider in Santa Ana, California. We help businesses identify auto liability risks, explain coverage options clearly, and structure policies that align with how your business actually operates.
Our goal is education first—so you can make confident decisions that protect your business.
Because being prepared is the key to your peace of mind.
👉 Get a quote or talk to us today.
Santa Ana, CA 92705
Reference
Insurance Information Institute. (2026). Facts + Statistics: Auto Insurance. Retrieved from https://www.iii.org/fact-statistic/facts-statistics-auto-insurance
California Department of Insurance. (2024). Commercial Insurance Guide. Retrieved from https://www.insurance.ca.gov/01-consumers/105-type/95-guides/09-comm/commercialguide.cfm#commercialautomobile
