Car accidents, even when they don’t involve injuries, are jarring and troublesome. This may be particularly true when they involve a business car that doesn’t belong to the driver. Most experienced drivers have been involved in at least one fender bender but may wonder what happens if they damage the company car or if such a collision is complicated by injuries. Their conscientious employers may worry too.
At Blue Lion Insurance Advisors, LLC in Redbank, New Jersey, we focus on providing business insurance policies that protect both companies and their employees from the consequences of car accidents as well as other unpredictable events. Because we are commercial insurance brokers not affiliated with any particular insurance company, we are able to be objective and offer a wide range of cost-effective options.
If you are an employer looking to prevent unnecessary difficulties when your employees drive company vehicles, contact us at (732) 649-1600 or on our website. We will provide you with a free consultation and advice tailored to your specific needs.
Why Accidents Involving Business Cars Are Complicated
Generally speaking, business car accidents raise more questions than crashes involving privately owned vehicles, such as:
- Will the employee’s injuries be covered by workers’ compensation?
- Who will cover property damages?
- Was the employee acting on behalf of the employer at the time of the collision?
- If the employee violated the law, will that affect the insurance outcome?
If you still have questions after reading this content, please contact us for an informative conversation with our helpful staff.
Vicarious Liability for Business Car Accidents in New Jersey
If your car accident has occurred within the scope of the driver’s employment, the legal doctrine of vicarious liability holds the employer responsible for both property damage and personal injuries. In almost all cases, these costs will be paid by the employer’s insurance company.
Examples of when the employer is responsible under the doctrine of vicarious liability include situations in which the employee was:
- Using the company car to visit a customer or client
- Driving to a business meeting
- Making deliveries of company products or materials
- Running work-related errands
- Transporting another employee
- Driving during work-related travel
Still, it is important to understand that the employer is not responsible for damages if the employee was:
- Engaging in criminal activity at the time of the accident (e.g driving while impaired)
- Using the company car to run personal errands
- Stopping for a cup of coffee en route to a work-related activity
- Driving to non-business (e.g. recreational) activities outside of business hours
- An independent contractor, driving for reasons unrelated to his/her contract
In any of the above situations, the employee’s own auto insurance will have to be tapped for coverage since, though the individual was driving a business car, the accident did not occur during work.
How does Workers’ Compensation Insurance feature in a business car accident?
Two types of employer insurance coverage are in play when an employee is involved in a business car accident:
- Commercial Vehicle Insurance will pay for losses sustained by a third party (e.g. driver and passengers of the other vehicle) for both property damage and personal injury
- Workers’ Compensation will cover injuries employee(s) suffered in the business car accident
Typically, an employee who has suffered injuries in a business car accident is limited to filing a workers’ compensation claim. Exceptions are made, however, if your employer’s actions caused the employee intentional harm or if the car manufacturer was the negligent party (e.g. sold the vehicle with a dangerous defect). In such cases, the employee may be able to sue for damages.
Both employers and employees should be aware, however, that it is usually impossible to file for Workers’ Compensation for injuries incurred during commutation unless the employee was performing a work-related task on the way to work.
Workers’ Compensation is a no-fault type of insurance so its payment of business car accident costs in no way holds the employer responsible.
Contact Our Knowledgeable Business Car Insurance Advisors Today
Don’t wait for an accident to happen. Be proactive. Call on Blue Lion Insurance Advisors, LLC to keep your insurance policy Blue Lion Strong™.