Quick Answer
Hired and non-owned auto insurance, often called HNOA, is low-cost liability coverage that protects your business when you or your employees drive vehicles the company does not own. It applies to rented or borrowed vehicles (hired) and personal vehicles used for work (non-owned). It covers the business against injury and property damage lawsuits, but it does not repair the vehicle itself.
What Is Hired and Non-Owned Auto Insurance? A Business Owner’s Guide
You do not own a single company car, so you assume you have no auto exposure. Then an employee runs to the bank in her own car, gets into an accident, and a few weeks later the injured driver sues your company, not just her. Now you are asking the question thousands of owners ask too late: is my business liable for an accident when an employee drives their own vehicle for work? Many owners assume the employee’s personal auto policy will step in and pay. It will not, because your company is not an insured on that personal policy.
The Coyle Group is a commercial insurance agency for business owners who have outgrown one-size-fits-all coverage and need a specialist who understands the nuances. Hired and non-owned auto, often shortened to HNOA, is one of the most overlooked gaps we find, and it is one of the cheapest to fix. It is generally an inexpensive endorsement, yet many agents and brokers forget to add it to a client’s coverage program, which leaves the business exposed to a claim it never saw coming.
The problem
Your business can be sued over an accident in a car it does not own, and the driver’s personal policy will not protect the company. Our approach: we treat auto exposure as something every business has, not just fleets, so the gap gets closed before a claim exposes it. Gordon B. Coyle has spent 40+ years finding and fixing this exact endorsement gap in business insurance programs.
Book a call and we will review whether your policy already includes this coverage.
What Is Hired and Non-Owned Auto Insurance in Simple Terms?
Hired and non-owned auto insurance is business auto liability coverage for vehicles your company uses but does not own. It protects the business, not the vehicle and not the driver’s personal liability, when an accident happens during work use. The part that surprises most owners is that the coverage splits into two very different exposures that many assume are one.
The name describes two separate situations, and your business can face either or both:
This coverage is not a standalone policy in most cases. HNOA is generally an endorsement added to either your commercial auto policy or your general liability or BOP policy. On the standard ISO Business Auto Coverage Form, hired autos are covered under Symbol 8 and non-owned autos under Symbol 9, which extends to vehicles owned by employees, partners, or members of an LLC while used in the business. When a business wants employee-hired autos treated as hired autos, the CA 20 54 Employee Hired Autos endorsement is the standard ISO form used to add it. If your current program was built as a one-size-fits-all package, this is exactly the kind of detail that gets missed.
Contact us and we will tell you which symbols are on your policy today.
Why Your Business Is Exposed Without It
Without hired and non-owned auto coverage, your business absorbs the liability every time an employee drives for work in a vehicle you do not own, and that exposure is far larger than most owners expect.
The cost of ignoring this is not theoretical. Motor vehicle crashes are the leading cause of work-related deaths in the United States, and in 2019 alone work-related crashes cost employers $39 billion, which the CDC breaks down to roughly $75,000 per nonfatal injury and $751,000 per death. Transportation incidents were also the single most frequent cause of workplace fatalities, accounting for 36.8 percent of all occupational deaths in 2023. With the CDC putting the employer cost of a single work-related crash death at $751,000, a business named in one of those lawsuits is looking at exactly that scale of exposure for an accident involving a car it never owned.
Here is the scenario we see most often.
Your company does not own any vehicles, but your bookkeeper runs to the bank on occasion and uses her personal vehicle. During one of those trips there is a serious accident, the other driver is injured and taken to the hospital, and a few weeks later that driver sues you and your firm. Many people assume the bookkeeper’s auto policy will step in and pay the claim. That is incorrect. Your company is not an insured on her personal auto policy, so there is no coverage there for the business. Her policy protects her, but you and your firm are exposed. Operating as an LLC does not automatically protect the business here, because the company can still be named directly in the suit. This is exactly where hired and non-owned auto steps in to protect your company from suits that arise from auto-related losses.
It is generally an inexpensive option to add, and it is a very needed coverage, yet many agents and brokers forget to add it to a client’s coverage program.
Do not wait for a claim to learn whether you have this gap. Book a call and we will pressure-test your current auto exposure.
What Does Hired and Non-Owned Auto Insurance Cover?
Hired and non-owned auto insurance covers your business’s liability for bodily injury and property damage caused when you or an employee operates a hired or non-owned vehicle for work. It pays for the other party’s injuries, their property, and your legal defense when the business is named in the suit. What it does with rental vehicles specifically is where the coverage quietly earns its cost.
The core protections include:
That rental piece matters. When renting a vehicle for business use, hired and non-owned auto provides excess liability protection above the rental company’s own liability limits, which are often thin. It works alongside your other liability layers, and for larger exposures it can sit under an umbrella and excess liability policy for added protection.
One important nuance is priority of coverage. Non-owned auto coverage is generally excess, not primary. When an employee drives their own car for work, the employee’s personal auto policy is expected to respond first, and your business’s HNOA coverage steps in to protect the company when that personal policy limit is insufficient or will not defend the business. That is why relying on an employee’s personal policy alone leaves the company itself unprotected.
Situation |
Covered by hired and non-owned auto? |
|---|---|
|
Employee injures another driver while running a work errand in their own car |
Yes, business liability |
|
Rental van damages another vehicle during a company delivery |
Yes, business liability |
|
Excess liability above the rental company’s limits |
Yes |
|
Physical damage to the rented or borrowed vehicle |
No, needs separate coverage |
|
The employee’s own injuries or their own car |
No |
To understand how this layer fits with the rest of your program, it helps to see how general liability insurance and commercial auto divide the risk.
What It Does Not Cover: Watch Out for These Gaps
Hired and non-owned auto insurance is liability-only coverage, which means it protects the business against claims from others but does not repair the vehicle involved or protect the driver personally. The gap that catches owners off guard is physical damage, because the coverage most people assume is included is actually sold separately.
Watch for these specific limits:
Because a business owners policy on its own does not cover vehicles at all, you need coverage beyond your personal car insurance once a car is used for work. If your operation involves frequent driving, we will help you decide whether an endorsement is enough or whether you have outgrown it. Contact us for a straight answer.
Who Needs Hired and Non-Owned Auto Insurance?
Almost any business whose employees ever drive for work needs hired and non-owned auto insurance, even a company with zero vehicles on its books. The trigger is not ownership, it is use, and that is why service businesses that would never call themselves fleet operators still carry the exposure.
Businesses that most commonly need this coverage include:
If any employee ever runs an errand, visits a customer, or picks up supplies in a personal car, the exposure is real. This is also the moment to confirm whether you have properly classified drivers as employees or independent contractors, because that distinction changes how liability attaches.
Not sure if your business qualifies? Book a call and we will map your exposure in a few minutes.
Key Benefits of Hired and Non-Owned Auto Coverage
The biggest benefit of hired and non-owned auto coverage is that it closes a serious liability gap for a very small premium. It protects business assets that would otherwise be exposed in a lawsuit, and it does so at a fraction of the cost of the claim it prevents. The benefit owners appreciate later, though, is how often it is required by someone else.
Key benefits include:
Many contracts now require proof of this coverage before work can begin, which shows up on your certificate of insurance. If a client asks for it and you do not carry it, the job can stall. Requiring the same coverage from your own vendors is a basic form of contractual risk transfer, and understanding your customer contract insurance requirements ahead of time keeps deals moving.
How Much Does Hired and Non-Owned Auto Insurance Cost?
Hired and non-owned auto insurance is one of the most affordable coverages in commercial insurance, because it is liability-only and is usually added as an endorsement rather than sold as a full policy. There is no fixed price, though, because your cost depends entirely on how much driving your business actually involves and the limits you choose.
Typical cost drivers include:
Pushes your cost up |
Keeps your cost down |
|---|---|
|
Many employees driving for work |
Few or only occasional drivers |
|
Frequent hired or non-owned vehicle use |
Rare, incidental use |
|
Poor employee driving records |
Clean driving records |
|
Higher liability limits |
Lower limits, within contract requirements |
Because pricing depends on your specific operation and the same factors that increase business insurance premiums overall, the only accurate number is a quote. For context on how the broader auto line is priced, see our breakdown of commercial auto insurance cost, and for the bigger picture, what small business insurance costs.
When you are ready for a real number, contact us for a quote tailored to your business.
How to Know If You Actually Have This Coverage
The fastest way to know whether you have hired and non-owned auto coverage is to look at the covered auto symbols on your commercial auto or liability policy, because the coverage is often assumed but not actually present. The catch is that a policy can look complete and still leave this endorsement off, which is why a quick check beats an assumption.
To confirm your coverage, do the following:
If you are not certain what you are looking at, that uncertainty is the exposure. This is a common blind spot even for businesses that believe they are fully insured. A fresh set of expert eyes on your policy takes minutes and can save six figures.
Why Business Owners Choose The Coyle Group
Business owners choose The Coyle Group because we find the coverage gaps other agencies miss, and hired and non-owned auto is one of the most common gaps we uncover. We do not treat auto exposure as a fleet-only problem, which is exactly the assumption that leaves service businesses unprotected. What sets the review apart is who is doing it.
The Coyle Group is led by Gordon B. Coyle, CPCU, ARM, AMIM, PWCA, who has spent more than 40 years structuring commercial insurance programs for business owners across the country. We build coverage around how your business actually operates, not around a generic template, and we make sure the inexpensive endorsements that prevent expensive claims are actually in place. If you have never had someone confirm whether hired and non-owned auto is on your policy, now is the time.
Ready to close the gap? Book a call and we will review your auto exposure and tell you exactly where you stand.
Frequently Asked Questions
This article was written by the CEO of The Coyle Group, Gordon B. Coyle, CPCU, ARM, AMIM, PWCA, who has over 40 years of experience working with business owners of all sizes and industries across the US, solving their insurance challenges.
