As part of my ongoing effort to keep clients and friends informed, I am sharing Chapter 4, “Company Vehicles,” from my handbook Don’t Get Sued! A Guide to Help Reduce Your Business’s Exposure to Lawsuits. This chapter explains company vehicle accident liability and how the right insurance choices can limit it.
Why Your Business Policy Is Usually Primary
Many businesses offer employees the use of company-owned vehicles. Often, employees drive those vehicles outside the scope of employment. In most cases, your business auto policy is primary, whether or not the employee is working for you at the time. In other words, your coverage pays first if your employee negligently injures someone or damages property while driving your company’s vehicle. For background on the District’s coverage requirements, you can review the DC DMV guidance on vehicle insurance.
How to Reduce Your Premiums
With that in mind, you can take steps to lower your premiums. First, ask your agent about making your business vehicle coverage secondary when an employee is not acting within the scope of employment. That change should insulate your business and help keep your rates in check. Next, consider waiving any available medical payment, or med-pay, benefits, which some policies name personal injury protection, or PIP. Medical expenses, and sometimes wage loss under PIP, fall behind workers’ compensation benefits anyway. Therefore, waiving that coverage on a work vehicle may make sense and trim your premiums further.
If you have been injured, our experienced car accident lawyers and personal injury lawyers are available for a free consultation.
