Hired non-owned auto insurance

Hired and Non-Owned Auto Insurance

Coverage for businesses that use rented or employee-owned vehicles for work

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What is Hired and Non-Owned Auto (HNOA) insurance?

It’s essential to make sure you and your employees are covered whenever you are behind the wheel. Add hired and non-owned auto coverage when you purchase a commercial auto policy for coverage when you or your employees drive a rented vehicle. It can also provide protection if an employee sometimes uses a personal vehicle for work.

Depending on the policy you purchase, coverage can pay for expenses up to your policy limit:

  • If someone’s property is damaged
  • If someone other than you or an employee is injured
  • If you have to defend a lawsuit or pay a legal judgment

What’s the difference between HNOA and Commercial Auto insurance?

Commercial auto insurance is essential for vehicles used for work, and it’s required by law in most states. It can help pay for expenses that are not covered by personal auto insurance if you or an employee get in an accident while you are driving for work.

For example, if you have two trucks owned by your construction business and one is damaged after an employee accidentally backs into a cement wall, your commercial auto insurance could help pay for repairs. If someone is injured during the accident, your coverage could also pay for medical expenses up to your policy limit.

Hired and non-owned auto offers expanded coverage for rented vehicles and occasional use of employee-owned personal vehicles — two areas that are not typically included with commercial auto insurance. If the employee was driving a rented or personal vehicle and backed into a cement wall, HNOA insurance would also provide coverage.

What does Hired and Non-owned Auto insurance cover?

HNOA coverage is available for third-party injuries and property damage if there is an accident involving rented vehicles or employee-owned personal vehicles occasionally used for business purposes. It can also cover defense costs and legal judgments.

Rented vehicles

Many businesses need to rent vehicles to transport equipment, drive to clients or attend business events. Your HNOA insurance can help pay for medical expenses if someone else is injured or you damage someone’s property while you are driving a rental.

Non-owned car insurance vs. rental car insurance

Some rental companies offer liability coverage that is similar to non-owned car insurance. However, prices and coverage vary between different rental companies, and you’ll need to carefully read the fine print every time you rent a vehicle. One day of rental insurance could be close to the entire monthly cost of an HNOA policy.

With HNOA insurance, you’ll know exactly what you are paying for and how much you are paying for coverage every time you rent.

Use of a personal vehicle for work

We know that many businesses have employees that occasionally use their personal vehicle for work. With HNOA, you and your employees will have a financial safety net that is not always provided by personal auto insurance if there is an accident while driving for work.

For example, if your employee uses a personal vehicle to remove temporary signs for your business and there is accident, your HNOA coverage can help pay expenses if someone other than your employee is injured or property is damaged.

It’s important to note that this coverage is offered on an “excess basis” — meaning it kicks in once the employee’s personal auto coverage reaches its limit or their insurance company denies coverage.

Defense costs and legal judgments

If an accident happens while driving a rented or personal vehicle, it can hopefully be resolved without legal action. Unfortunately, that is not always the case and you could find yourself defending a lawsuit if someone claims it was your fault.

Your HNOA policy can cover lawyer fees, and other legal expenses and judgments up to your policy limit.

Who needs Hired and Non-Owned Auto insurance?

Any business owner or employee who uses rented vehicles or any employee who occasionally uses a personal vehicle for work purposes can benefit from HNOA coverage.

Here are some real-world examples of how it works:

Construction trades

Your employee is picking up a few random materials for a home remodel job using a personal vehicle. They accidentally back into your client’s garage door, and now it won’t open. Your HNOA insurance will help pay for repairs to the garage door after your employee’s personal auto policy reaches its limit.

Real estate professionals

You are a real estate agent and you ask your part-time assistant to put up signs for an open house. While driving to the property, he gets into an accident and another driver is injured. When your assistant’s personal auto coverage reaches its limit, your HNOA insurance will help pay for medical expenses for the other driver’s injuries and damages to the other vehicle.

Consultant businesses

You are a consultant and need to rent a vehicle to visit a client’s office 50 miles away from your home office. On the way to visit your client, you get into an accident and another driver is injured. HNOA insurance will cover the damage to the other vehicle and the other driver’s medical expenses up to your policy limit. Damage to your rental would not be covered.

How much does Hired and Non-Owned Auto insurance cost?

Hired and non-owned insurance is offered as an upgrade to our commercial auto insurance policy. Simply select the coverage level that’s right for your business when you apply for a quote online.

Basic coverage can start at about $7 a month. A Pro policy starts as low as $8 a month or choose a Pro Plus policy for around $12 a month. Your quote could be slightly lower or higher depending on your business location and operations.

What is not covered by HNOA?

Commercial auto insurance with hired and non-owned auto coverage is an important part of your business insurance package. However, there are some damages it does not cover, including:

  • Damage to the rented vehicle 
  • Damage to your employee’s vehicle 
  • Goods or equipment you are transporting
  • Accidents that happen during a commute to or from work

It’s also important to consider other coverage options to make sure you are protected from additional risks:

General liability insurance

Most businesses purchase general liability insurance so they are protected from financial losses if someone other than an employee gets injured or there is damage to someone’s property in an accident that doesn’t involve driving. You can add tools and equipment insurance to this policy to help pay for repair and replacement costs if your gear is damaged, stolen or lost.

Professional liability insurance (a.k.a errors and omission coverage)

Professional liability insurance, also known as errors and omissions insurance, can cover associated costs when a client claims you gave bad advice, made a mistake or missed a deadline and caused financial harm.

Workers’ compensation

Workers’ compensation insurance can cover medical bills, lost wages and other expenses if you or an employee are injured on the job. Most states require it as soon as you hire your first employee.

How Next Insurance helps small businesses

Next Insurance is 100% dedicated to small businesses and self-employed workers. Our online services are streamlined, painless and backed by a team of licensed U.S.-based insurance advisors that can help you at every step of the way.

Start an instant quote today to review options for your business. You can purchase a policy and have a digital certificate of insurance in about 10 minutes.


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The Live Certificate is the digital alternative to paper/downloaded Certificates of Insurance. It’s completely online proof of insurance which you can easily and instantly share with anyone, by email or through a link.
Who is Next Insurance?
We're a group of designers, engineers, and insurance geeks based in Palo Alto, California. We want to use our deep industry experience at companies including Intuit, American Express, PayPal, Check, and Oracle to transform insurance for small businesses. We're an insurance agency licensed in all 50 states.
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