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You Hit Your Employee’s Car, Which Insurance Do You Use?

It’s finally Friday. You call it quits an hour early, your employees have earned it.
You walk out of the office building with one of your employees discussing your weekend plans. After wishing them a good weekend, you go separate ways and head out to the car parked on the street.

You get into your car, put on your sunglasses, fidget with the radio and begin pulling out of your parking space. As you’re pulling out, you don’t notice the car coming up the road from behind you. You feel a sudden powerful jolt. There are tires screeching and metal crushing. You just T-boned one of your employees. And oddly enough, it happens to be the employee you just wished a good weekend to. The accident was clearly your fault, and you own it. The question is, do you use your personal liability auto insurance plan, or your businesses?

Technically, you were still on company time. But could it be that simple? CoverHound has the answer below.

Which Plan Covers the Accident?

As a business owner, you have more than likely purchased a small business insurance plan that includes general liability protection. This covers you if someone suffers injury in an accident on company property. The thing is, no one owns the street. Street parking is public parking. And even though the accident occurred during work hours, you were not transporting passengers, goods or providing a service—you were heading out for the day, and so was your employee. It’s not your business insurance you’ll be using, it’s your auto personal liability insurance.

Auto Liability Insurance: The Run-Down

Virtually every state across the U.S. requires licensed drivers to carry a liability insurance plan. Liability insurance can be broken up into two parts: Bodily Injury Liability and Personal Property Liability.

Your liability insurance plan is built of these two parts. Thus when you are found to be at fault in a road collision, your policy will cover the medical and repair costs of the other driver. Because all costs are covered under your insurance claim, the other driver will not be able to sue you for damages. Though a quick note, liability insurance does not compensate you for your losses, it only compensates the other driver in the accident.

Accidents on the Job

If the accident occurred during working hours and you hit your employee as they were performing a service or transporting goods, you would use your small business umbrella policy. A small business umbrella policy includes:

Each of the above protects you and your employees in work-related accidents. This includes hitting your employee’s car, but only if they are using it for a work-related service.

We’re not perfect. Accidents can happen anywhere, any time and to anyone. To get an insurance coverage plan that will protect you, contact CoverHound today.

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