What Happens if you Have an Accident in a Company Car?
Updated: Nov 15, 2022
A car accident is a frightening and worrying event in any case, but crashing a company vehicle carries an extra level of stress. Employees who drive company vehicles regularly may find themselves wondering what exactly happens if an accident occurs and who is liable?
From independent contractors to pizza delivery guys, many people use a company vehicle almost every day. What they probably do not do is read up on what cover and protection they actually have if something ever goes wrong.
Either the employee or the employer may be held liable for any damages, depending on the employer's insurance policy.
The purpose of the journey at the time of the accident can determine who should pay.
Most companies do not offer insurance coverage for a personal vehicle.
Liability ultimately falls to the at-fault party or parties, but the question is whose insurance should provide cover.
Any driver involved in an accident when using a company vehicle should seek legal advice and find out the details of their employer's insurance.
Who Normally Pays for Damage to a Company Vehicle After an Accident?
In a nutshell: it depends. It depends on the circumstances of the accident, the nature of the damage, and the type of liability insurance the employer has in place. Of course, if the driver was not at fault, the other driver involved should be required to pay damages.
Determining who is at fault in a self-driving car accident is only one element of deciding who should pay for the repair of a car after an accident involving a company car. If one is the at-fault driver, it comes down to the insurance policy.
There are three main types of liability policies that most insurance companies have in place for company vehicles: employer, employee, and vicarious liability. Which of these policies the employer's insurance company offers determines who has to pay up.
If a company car is covered by an employer auto insurance policy, then the costs are covered by the company, not the individual. There are, however, specifications of what is and is not accepted. To hold the employer liable, the driver's activity and movements at the time of the crash must be in line with the company agreement.
Companies with large fleets and multiple drivers often have high-quality car insurance for all their vehicles, but smaller operations may not be able to afford quite so much.
Some companies hold their staff personally liable for any and all damage to a company vehicle. In this case, the driver is responsible for paying for any property damage, medical bills, and any other costs the accident involves.
If they are at fault for the accident, they must also use their own insurance company to settle any third-party claim against them from other accident victims. Depending on the company, the employer may pay the costs upfront and claim it back from the employee or ask them to take it up with their insurance.
The most common liability agreement for covering a company vehicle is vicarious liability. It is essentially a sliding scale that helps with determining liability for an accident in a company car. As long as the employee driving was carrying out a work-related task or authorized act and was not drunk driving or being reckless.
Vicarious liability applies to any accident or work-related injury sustained when driving a company car during business hours for company business.
Cover can vary depending on the surrounding circumstances, so it is essential for any person who drives a company vehicle to read and understand the ins and outs of vicarious liability, as well as understanding their employee rights, before taking to the road.
What Happens if you Have a Car Accident when Using your Personal Vehicle for Work Purposes?
If a person uses their own vehicle for work purposes of any kind, they should speak to their employer to determine if they have any cover in place. Usually, it is down to the owner of the car to arrange personal liability insurance on their own initiative.
Some companies may arrange insurance for a person's own car if it is absolutely necessary for performing work duties; however, it is not the norm. Before using a personal car for professional use, drivers should be sure it is worth it.
When to Contact the Insurance Company
Anybody involved in a work-related car accident in their own vehicle should speak with their insurance straight away. It is also worth looking into the company's policy on workers' compensation, as this could help to cover lost wages in some circumstances.
Always collect the details from the other party involved in the car crash and ensure a police report is completed at the accident scene. The more information and evidence a person can take to their insurance company or employer, the better chance they have of reaching a favorable outcome.
It is also worth getting in touch with an experienced attorney with a background in personal injury and car accident law. Anybody can schedule a free consultation with the Keating Law Firm to further discuss their case.
What Happens if you Have a Car Accident when Using a Company Car to Run Personal Errands?
Vicarious liability dictates that an employee that has an accident in a company car while running a personal errand rather than work activities may not be entitled to cover and is, therefore, liable. If an accident occurred while a person was dealing with personal business using a company car, they could be left without cover.
The lines are, however, blurry when it comes to what exactly is acceptable and what is not. Driving The wording used in the average vicarious liability policy is:
"The employees' actions at the time of any car accidents should be within the scope of employment."
A car accident in a company car when running personal errands is unlikely to be covered. If an employer decides the activities were not work-related, the driver is not likely to get far with the company insurance.
What Is Classed as "Acting Within the Scope of Employment"?
Acting within the scope of employment essentially means that driver must have been carrying out a task that is directly or at least closely related to their job role. If the responsible driver cannot justify the employee's car accident was related to work, they may have to use their own insurance to make a claim.
To give an example, a delivery driver who sustains a personal injury when driving a company car to drop off a parcel is well within the scope of employment. If, however, they were involved in an accident parking in a shopping mall car park on their day off, it probably would not be accepted.
Another example could be an office worker driving to the post office on their way home. If it is confirmed that they were taking company papers, this is acceptable. On the other hand, posting a personal gift after leaving the office is not. Where it gets complicated is that technically by driving home from work, you are completing a necessary work task.
What Is Claimable in a Company Car Accident?
An injured driver is entitled to claim for a variety of things. First of all, any medical bills for injuries sustained should be paid by the other driver (whoever is at fault) or their insurance. This includes ongoing treatment, prescriptions, and checkups.
They can also claim for lost wages, either through the claim or via workers' compensation where applicable. Lost wages are essentially any earnings a person would have earned had they not been injured.
Victims of car accidents can also claim out-of-pocket expenses, including parking, travel costs, and necessary medical purchases.
A personal injury case, including an accident in a company car, can involve many elements to determine the value. Our expert personal injury attorneys are always ready to meet clients for a free consultation and to discuss what settlement is possible.
Why Contact an Attorney?
Car accidents are complicated, made even more so by having to take it up with a company's insurance policy. Many factors can make the proceedings difficult, from claims of comparative negligence to employers who do not want to pay out in cases for which they are liable.
The only person who can ensure every client gets what they are entitled to and all liability land at the correct door is an experienced automobile accident lawyer in Nashville TN. Rather than deal with corporate insurance and the hassle of negotiations, the victim can focus on making a full recovery.
Arrange a Free Consultation Now with The Keating Law Firm
Take advantage of the attorney-client relationship and our offer of a free case review. Our firm excels at winning settlements in car accident cases. Meet soon with an experienced auto accident lawyer in Columbus OH that is excited to be on your side.
When crashes happen in any car, it is normal to take a while to get organized. If the accident happened in a company car, this experience can be even more stressful. Let us do the hard work for you. Call us today.