Hired & Non-Owned Auto
Insurance — When Employees
Drive Their Own Vehicles for Work.
Your commercial auto covers the vehicles your business owns. The moment an employee drives their own truck, van, or car on a work errand and causes an accident — your business is exposed. Their personal auto policy excludes business use. Your commercial auto doesn't cover vehicles you don't own. HNOA fills that gap.
What Hired & Non-Owned Auto Insurance Covers
Liability coverage for your business when vehicles you don't own are used for business purposes.
Hired and non-owned auto (HNOA) insurance covers your business's liability when a vehicle your company doesn't own is involved in an accident during business use. It covers two distinct situations: hired autos — vehicles rented or leased for business purposes — and non-owned autos — personally owned vehicles driven by employees on behalf of the business.
The coverage is liability only. HNOA covers the bodily injury and property damage your business becomes legally responsible for when a non-owned or hired vehicle is used for work and causes an accident. It does not cover physical damage to the vehicle itself — that's the driver's own auto policy's job. What HNOA specifically protects is your business from the third-party liability exposure that arises when employees use their own vehicles for work tasks.
HNOA is typically added as an endorsement to your commercial auto policy or general liability policy at a modest additional premium. For businesses that don't own any vehicles but have employees or contractors who regularly drive for business purposes, it may be the primary auto-related coverage in the program.
"When your employee drives their own truck to a job site and causes an accident on the way, your business gets named in that lawsuit. Their personal auto policy excludes business use. Your commercial auto only covers your vehicles. HNOA is the only policy that covers your business in that scenario."
Vicarious liability is the legal principle that makes this exposure real for businesses. When an employee is driving for a work purpose and causes an accident, the employer can be held vicariously liable for the damages — even though they weren't in the vehicle and don't own it. HNOA covers that employer liability so it doesn't come out of the business personally.
What hired & non-owned auto covers:
Third-party bodily injury
Injuries to other drivers, passengers, or pedestrians caused by an accident involving a non-owned or hired vehicle during business use
Third-party property damage
Damage to other vehicles or property caused by an accident involving a non-owned or hired vehicle during business use
Legal defense costs
Attorney fees and court costs to defend your business against liability claims arising from non-owned or hired vehicle accidents
Hired auto liability
Liability arising from vehicles your business rents or leases — including rental cars used during business travel
Non-owned auto liability
Liability arising from employee-owned vehicles used for business errands, deliveries, site visits, or any work-related driving
Employer vicarious liability
Your business's legal liability as the employer when an employee causes an accident while driving for work purposes
Hired Auto vs. Non-Owned Auto — Two Different Exposures
HNOA covers two distinct situations — here's exactly what each one means and when it applies.
Hired and non-owned auto are two separate coverage components bundled into one policy. Understanding both helps you see why businesses of almost every type have at least one of these exposures — and most have both.
Hired Auto
Vehicles your business rents, leases, or borrows for business use
Hired auto coverage applies when your business rents a vehicle — a car for a business trip, a van for a delivery, a truck for a job — and that vehicle is involved in an accident during business use. The rental company's counter insurance is expensive and often inadequate. Your HNOA hired auto coverage provides your business's liability protection for vehicles you've taken control of but don't own.
Non-Owned Auto
Personally owned vehicles driven by employees for business purposes
Non-owned auto coverage applies when an employee or contractor uses their own vehicle — their personal truck, car, or van — for a work-related purpose and causes an accident. The business can be held vicariously liable as the employer. The employee's personal auto policy typically excludes or limits business use coverage. Non-owned auto under HNOA covers the business's resulting liability.
Why Your Other Policies Don't Cover This
Commercial auto, GL, and the employee's personal auto each leave the business exposed in different ways.
Commercial Auto
Your commercial auto policy covers vehicles your business owns, leases long-term, or has scheduled on the policy. It does not extend coverage to employee-owned vehicles or short-term rentals. When an employee's personal vehicle is involved in an accident during a work errand, your commercial auto policy has no response — the vehicle isn't yours.
Employee's Personal Auto Policy
Personal auto policies typically exclude or significantly limit business use. An employee using their vehicle for work purposes — making a delivery, running a business errand, driving to a job site on behalf of the employer — may find their personal policy denies or limits coverage for that accident. When their policy limits are exhausted or denied, the injured party looks to the employer — your business — to cover the gap.
General Liability
GL policies include an auto exclusion that specifically excludes bodily injury and property damage arising from the use of an auto — whether owned, hired, or borrowed. If the accident involves a vehicle, GL doesn't respond regardless of who owns it. HNOA is specifically designed to cover the auto liability gap that GL leaves for non-owned and hired vehicles.
The gap in plain terms: If an employee drives their own vehicle for your business and causes an accident — your commercial auto doesn't cover it, their personal auto may deny it, and your GL explicitly excludes it. HNOA is the only coverage designed for exactly this situation. Without it, your business absorbs the liability with no insurance backstop.
Who Needs Hired & Non-Owned Auto Coverage
Any business where employees or contractors use their own vehicles — or where the business rents vehicles — for work purposes.
The exposure is broader than most business owners realize. If any employee ever drives their own car for a work-related purpose — even occasionally — the business has non-owned auto exposure.
Contractors & Trades
Subcontractors and employees who drive their own trucks to job sites, pick up materials, or haul equipment create non-owned auto exposure for the business on every trip.
Landscaping & Field Services
Crew members who drive their own vehicles to job sites, nurseries, or supply yards on behalf of the business create non-owned auto liability for the employer on every errand.
Businesses Without a Fleet
Companies that own no vehicles but have employees who regularly drive their personal cars for deliveries, client visits, or errands need HNOA as their primary auto liability coverage.
Professional Service Firms
Consultants, accountants, real estate agents, and other professionals who drive to client meetings in their own cars create non-owned auto exposure for the firm every time they make a client call.
Delivery & Courier Operations
Businesses that use contracted or employee-owned vehicles for deliveries — food delivery, courier services, last-mile distribution — have significant non-owned auto exposure on every run.
Sales & Service Teams
Any business with sales staff or service technicians driving their personal vehicles to client locations creates non-owned auto exposure on every trip. The errand doesn't have to be dramatic to create liability.
Businesses That Rent Vehicles
Businesses that rent vehicles for business travel, trade shows, job site use, or any other business purpose need hired auto coverage for that rental period. Counter insurance at the rental desk is not the right answer.
Any Employer Who Reimburses Mileage
If your business reimburses employees for business mileage, that's a strong indicator of non-owned auto exposure — you're acknowledging they drive their own vehicles for work. The liability exposure that accompanies that reimbursement needs to be covered.
Real Scenarios
HNOA claims that happen to real businesses — and why no other policy in the program would have responded.
A subcontractor driving his own truck to a job site causes an accident
A landscaping subcontractor is driving his personal truck to a client's property when he runs a red light and seriously injures another driver. The injured driver's attorney names both the subcontractor and the landscaping company — arguing the subcontractor was acting as an agent of the business. The commercial auto policy doesn't cover a vehicle not owned by the business. The subcontractor's personal auto limits are quickly exhausted. HNOA covers the business's vicarious liability for the remainder of the claim.
An employee picks up supplies in their personal car and rear-ends someone
A contractor sends an employee to the supply house to pick up materials for a job. On the way back, the employee rear-ends a vehicle at a stoplight, causing injuries. The employee was clearly acting within the scope of their employment. The business is named in the injury claim. Their commercial auto doesn't cover the employee's personal vehicle. The employee's personal auto policy has limited coverage and excludes business use. HNOA covers the employer's liability in the lawsuit.
A rented van used for a delivery causes property damage
A business rents a cargo van for a large delivery. The driver misjudges a tight turn and damages a client's fence and landscaping. The rental company's counter insurance covers the van itself — but the business's liability to the client for the fence and landscaping damage is the business's problem. Hired auto under HNOA covers the business's liability for property damage caused while operating a rented vehicle on business.
A sales rep driving to a client meeting causes a serious accident
A sales representative drives her personal car to a client presentation. On the highway, she causes a multi-vehicle accident with significant injuries. The injured parties pursue both the employee personally and the employer as the entity that directed her to make the client call. The employer has no commercial auto — they own no vehicles. Without HNOA, the business has no coverage for the employer liability portion of this claim. HNOA is the employer's only coverage in this scenario.
A pool service tech causes an accident driving his own truck on a service route
A pool service technician drives his personal truck on his assigned service route, stopping at customer properties to service pools. He causes an accident between stops. The business directed his route and scheduled his service calls — he was clearly working for the employer when the accident occurred. The business is named in the claim. The tech's personal auto policy denies the claim for business use. HNOA covers the employer's liability as the business that directed the employee's driving activity.
A business without a fleet gets named in an employee's accident claim
A small consulting firm has no company vehicles — all employees drive their own cars to client sites. An employee causes a significant accident driving to a client meeting. The firm is named in the resulting lawsuit along with the employee. Because the firm has no commercial auto policy, they assumed there was no auto exposure. Without HNOA, the firm has absolutely no auto liability coverage for this claim. HNOA is specifically designed for businesses in this situation — no owned vehicles, real auto liability exposure.
Why Get Your HNOA Coverage Through McKnight
HNOA is one of the most consistently overlooked coverages in small business programs — and one of the easiest gaps to close.
Hired and non-owned auto is one of the most common gaps we find when reviewing a business's insurance program. Most business owners have never thought about it — and most agents don't bring it up — because the exposure isn't obvious. No vehicles means no auto insurance, right? Wrong. The moment any employee drives for a work purpose in their own vehicle, the auto liability exposure is real regardless of who owns the car.
HNOA is typically inexpensive — often added as an endorsement to an existing commercial auto or GL policy for a few hundred dollars per year. The cost is modest; the exposure it covers is not. A single serious accident involving an employee's personal vehicle used for business can generate a six-figure claim against the employer with no insurance backstop if HNOA isn't in place.
We also look at how the business uses vehicles when reviewing any commercial program — asking specifically about employees who drive their own vehicles for deliveries, client visits, errands, or job site travel. If the answer is yes to any of those, HNOA goes into the recommendation. It's a standard part of building a complete program for any service business, contractor, or employer with field staff.
Gap identified as part of every review
We ask specifically about non-owned vehicle use when reviewing any commercial program — it's a gap we look for by default.
Added to existing program efficiently
HNOA is typically an endorsement — we add it to your existing commercial auto or GL policy without a full program change.
100+ carriers
We find the right carrier and structure for your HNOA exposure — whether you need it as a standalone or an endorsement.
Real answers when you call
817.277.6166, weekdays 8:30–5pm. A claim involving an employee's vehicle or coverage questions — we pick up.
FAQ
Hired & non-owned auto questions we hear all the time.
Get Started
If employees drive their own vehicles for your business — your program needs to address that exposure.
Call us or request a quote. We'll identify the right HNOA structure for your business and add it to your program so the gap is closed.
McKnight Insurance Services · Mansfield, TX · Weekdays 8:30am–5pm