When one of your employees drives on behalf of your business, there is always the risk of a wreck occurring. Whether you employ professional drivers or send an employee to the store, the company’s risks go up.
Car accidents that occur during business operations are usually covered by commercial auto insurance. Commercial auto insurance can cover both employee-owned and business-owned vehicles. These policies generally don’t cover employees when they operate personal cars for personal reasons.
Commercial auto insurance also has different coverage parameters. The amounts of coverage may be higher than regular auto insurance. This provides protection if a business or employee is the responsible party in a wreck.
However, many employers wonder when a business is liable for the damages an employee driver causes. Shouldn’t drivers always be the liable party? After all, the employee was behind the wheel.
Not necessarily so. Employees and company vehicles are representatives of your business. Because a representative of the business was responsible for the wreck, a victim may sue or request that the company’s insurance cover their damages.
There are several instances where a business’ practices make it liable for accident damages. Many of these cases involve employer negligence.
- Negligent Supervision: Let’s say that an employee is driving unsafely. That driving might violate company policy and local laws. But, if the company fails to monitor this driver’s practices, then the company will likely be responsible if there is an accident.
- Other Negligence: An employer may also be negligent if they hire a person with poor driving history. Employers should always go to lengths to ensure that their drivers practice safe driving techniques.
- Vicarious Liability: This application of the law essentially means that a driver acts on behalf of a company. If an employer tells a driver to do something, and the driver does it, then the results are the same as if the company itself acted. An employer might tell a driver to deliver an order. The driver may have a wreck. If the driver is speeding, then the company may be liable. The company may even be liable even if it put no pressure on the driver to speed.
If someone accuses a company of negligence, it may face the risk of lawsuits and financial losses. While commercial auto insurance may help, many cases of negligence can cause an insurance company to deny a claim.
Nonetheless, there are always recourses. Companies can always fight the charges. In some cases their commercial auto insurance or business insurance may help cover these fights.
If you have a negligence claim in commercial auto practices, you should speak to your commercial auto insurance provider. Auto Insurance Discounters can help you understand how your policy can help and protect you. We are here to help also. Call us today at (866) 288-6545 for more information.