Many variables affect culpability, insurance coverage, and financial responsibility when an employee drives a work vehicle and is found to be at fault in an accident. Protection of your company from possible losses depends on knowing how business insurance policies work in such circumstances.
Business Auto Insurance and Employer Liability
Most companies have commercial auto insurance meant to cover mishaps involving their owned vehicles. Your company auto insurance will usually pay losses to other parties, including medical expenses, property damage, and legal fees, up to the policy's coverage limits if an employee causes an accident while engaged in activities connected to their employment. This implies that your business insurance should guard the organization from major financial risk even if your employee is to blame.
The employee might not be protected, though, if they were not utilizing the car for business-related purposes at the time of the accident. Under these circumstances, other liability safeguards like personal insurance might have to take the front stage.
Financial Responsibility for Damage
Many times, should damage surpass policy limits, your business may be held financially liable for the remaining expenses. For instance, your company could have to pay the remaining $50,000 out of cash if the damages come to $150,000, but your insurance just covers $100,000. This is why you should make sure your company is covered enough to manage the possible hazards.
If certain companies are working under the purview of their employment, they could also be accountable for paying back workers who were hurt in the accident. Workers' compensation insurance would thus cover medical expenses and lost pay for the injured employee in such circumstances.
Staff Accountability and Disciplinary Action
Although your company insurance would probably cover the accident, the employee's activities starting the incident could still have repercussions. Should the worker be driving carelessly or intoxicated by drugs or alcohol, they could be subject to disciplinary action or perhaps firing. Under some circumstances, your company could ask the employee to reimburse any financial losses or higher insurance premiums the accident causes.
Effects on Insurance Premiums
Should your employee be at fault in an accident, your business's insurance rates could climb. Your company can be seen by insurance companies as more risky, which would raise the cost of your commercial auto insurance coverage.
Conclusion
Your commercial auto insurance should cover damages if an employee is at fault in a work vehicle accident; nonetheless, it is imperative to make sure you have sufficient coverage. Furthermore, observing staff driving behavior and acting with corrections could help to reduce hazards and prevent next mishaps.