Hired and non-owned auto insurance trucking: rented trucks

Hired and non-owned auto insurance in trucking is the coverage that deals with vehicles your business uses but does not own. It matters the week your truck is in the shop and you rent one to keep your loads moving, or the day a friend lends you a tractor. Many owner-operators assume their policy follows them into any truck. Often it does not. Here is how it works, in plain words.

How your policy knows which trucks are covered

Most truck policies for owner-operators and small fleets work from a list. Each truck and trailer you insure is written on the policy with its year, make and VIN (vehicle identification number). Insurance people call these scheduled autos, because they are on the schedule, the list.

Your auto liability coverage is the part that pays for harm you cause to other people in a crash. On many policies, it is tied to the vehicles on that list. A truck that is not on the list may not have your liability coverage behind it, even if you are the one driving. Every policy is different, so the only way to know is to read yours or ask.

Hired and non-owned auto insurance trucking: the two parts

The name has two parts, and each one answers a different question.

Hired auto deals with vehicles your business rents, leases, hires or borrows. A common example: you rent a tractor for a week from a rental company while yours is being repaired.

Non-owned auto deals with vehicles that your business does not own, rent or borrow, but that are used for your business. A common example: an employee drives a personal pickup to get a part for your truck and has a crash on the way.

In both cases, the main purpose is liability. It is about your business being responsible for harm to others while one of those vehicles is used in your work. It is usually added to a policy by endorsement, which is a page that changes or adds to the policy. It is not automatic, and not every insurer offers it for every trucking operation.

What it usually does not do

It helps to know the edges of this coverage before you count on it.

• It may not pay for damage to the rented truck itself. Liability pays other people. The rental truck is someone else's property in your care. Damage to it is a different question, sometimes handled by a separate coverage often called hired auto physical damage, or by what you arrange in the rental contract.
• It is not for a trailer you pull under an interchange agreement. That is trailer interchange coverage. Our article on trailer interchange coverage explains it.
• It does not pay your rental bill. The cost of renting a truck while yours is down is a separate topic. See our article on downtime and rental reimbursement.
• It may not be the first policy to respond. When the owner of the vehicle has insurance, the policies sort out which one pays first according to their terms.

What to ask before you rent or borrow a truck

Make these calls before you put the key in:

1. Ask your agent if your policy has hired auto coverage, and if it applies to the kind of truck you are renting and the work you will do with it.
2. Ask if the truck should be added to your policy for the time you have it. For some rentals, adding the unit as a scheduled auto for those days is the cleaner answer.
3. Read the rental contract. Look for what insurance it requires from you, what limits it asks for, and who is responsible for damage to the truck.
4. Ask the rental company what proof of insurance it needs. It may want a certificate with specific wording.
5. Check your cargo coverage. Ask if your cargo coverage follows the freight when it is on a truck that is not on your list.
6. Get the answers in writing when you can.

Give yourself time. Calling at 5 p.m. on a Friday for a truck you pick up Saturday morning leaves little room to fix anything.

Borrowing is not simpler

When a friend says "take my truck," it feels easier than renting. It is not. There is no rental contract to tell you who is responsible. You would be relying on what your friend's policy says about other drivers and other businesses, and on what your own policy says about borrowed vehicles. Find out both before you move it. And remember the rest of the rules still apply: the truck needs to be properly marked, inspected and tied to the right authority for the load.

Mistakes to avoid

• Assuming your policy follows you into any truck.
• Renting first and calling your agent later.
• Thinking liability coverage fixes the rental truck. Damage to that truck is a separate question.
• Not reading the rental contract's insurance section.
• Letting an employee run business errands in a personal vehicle without asking how your policy treats it.

To see how the parts of a truck policy fit together, read our guide to truck insurance coverage explained.

When to call us

Truck going into the shop and you need a rental? Call TCZ Insurance Agency at 956-526-6727 before you sign the rental contract. Tell us what you are renting, for how long and what you will haul. We will tell you what your policy says and what options are available. We cannot promise that a rental is covered until we check your policy.

Common questions

Does my truck insurance cover a rental truck? Not automatically. Many policies only apply to the trucks listed on them. Ask your agent before you drive a rented truck.

What is the difference between hired auto and non-owned auto? Hired auto is for vehicles your business rents, leases or borrows. Non-owned auto is for vehicles owned by others, such as an employee's own vehicle, used for your business.

Does hired auto coverage pay for damage to the rented truck? Usually the liability part does not. Damage to the rented truck needs its own coverage or arrangement. Check the rental contract and your policy.