Insuring Hired and Borrowed Autos Under Business Auto

Summary: Most organizations have a need for insurance on autos they hire or borrow from others. For example, even in the absence of an agreement requiring the user to provide certain types of insurance on the hired or borrowed auto, the user can become liable to members of the public as a result of the user’s negligent operation of the vehicle and liable to the owner for lack of care in protecting the auto from harm. A lessee may be required to provide primary insurance on its leased autos. And, even if an insured does not anticipate hiring or borrowing any autos during the policy period, it will still be well advised to have hired autos coverage included in the policy; after all, if no exposure develops during the policy period, the insured will only have to pay a low minimum premium and if the coverage is not bought and exposures develop, any resulting loss will not be covered under the insured’s coverage for owned autos.