Guide to Mobile Employees Car Insurance

Written by mBurse Team Member Aug 14, 2017 8:04:00 AM

Don’t Risk an Accident: A Guide to Mobile Employee Car Insurance

If you have employees using their own vehicles for business travel, your company faces the constant risk of an employee-involved accident. With employees traveling your company has an increased risk component and your mobile employees car insurance is a driver. It is imperative that you mandate sufficient minimum car insurance coverage and verify regularly that all employees are maintaining their coverage. If a mobile employee’s car insurance lapses or they are not carrying the minimum coverage and that employee causes an accident during work hours, your organization could face serious financial and image repercussions.

The only way to know if your employees are maintaining the proper level of car insurance is to verify the insurance. The following steps will guide you as you seek to reduce risk through insurance coverage requirements and verification practices.

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  1. Institute annual insurance verifications immediately.

At a minimum, your organization should make it standard practice to verify auto insurance at least once a year. Even better—conduct auto insurance checks twice a year, since most policies renew every six months. If you already have an annual verification policy but are not enforcing it, start enforcing it immediately, or you could find yourself facing some very unpleasant consequences.

  1. Go above and beyond state minimum insurance coverage.

An auto accident can get very costly very quickly. When you factor in damage to the vehicles along with injuries or even fatalities, a single incident can easily top $50,000 or even $100,000. Very few states require coverage beyond $25,000 per bodily injury, $50,000 total injuries, and $25,000 in property damage. To be safe, require a minimum of $100,000/$300,000/$50,000, expressed as a 100/300/50 policy.

  1. Write a comprehensive verification policy.

Creating and enforcing an insurance verification process may sound like a huge challenge. The key is to have a good plan. It all starts with the required minimum amount and frequency of verification checks. Once those policies have been established, determine the consequences for non-compliance, and detail the process for carrying out and documenting the verifications. Clearly designate who will be responsible for managing the process and administering each part of the policy.

  1. Stay committed to the policy.

You can have the best policy in the world, but if you fail to enforce it, you will receive none of the benefits. You will remain highly exposed to risk of an employee accident. Conducting a periodic review of the policy and procedures with all stakeholders as well as a review of its actual enforcement will allow you to identify challenges that have arisen and create adjustments that will facilitate full implementation.

If you are falling short of verifying employee auto insurance, remember the adage that you can’t manage what you can’t measure, or see. If an employee decides to make a cost cutting decision with their insurance coverage, your organization could be the one footing the bill. Take steps to verify auto insurance at least once—if not twice—a year.

We have developed a comprehensive guide to risk to assist in building or improving your mobile employee risk policy. Our best practice guidelines will help you understand, benchmark and make changes to your company car allowance or mileage reimbursement policy. Our self-paced guide will help you establish general liability, Respondeat Superior/negligent entrustment, tax, and labor codes best practices. 

Mitigate your respondeat superior and mobile employee risk

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