Risk Management

scron

An employee of a non profit agency has to use her vehicle on company business. They provide a valid driver's license, driving record, proof of insurance. If their vehicle becomes damaged while driving on company business (i.e. a rock hits the windshield) is the agency legally obligated to pay for the damages?

Hunter1

Legally, no I don't think so, but your policy should state that the employee's insurance will be the first to respond if there is such an occurrence. If you're paying mileage, that payment is for the cost of operating a vehicle, and that includes insurance. It's probably not a good idea to get into the practice of paying for small damages either; what happens if the car is totalled? Does your agency have the money to pay for it?

Rockie

We had this same issue recently where an employee drove her husband's truck over to the hospital to run a test for a patient and she turned a corner too sharp in the parking garage and scraped hubby's truck. It did about $500 in damage. Hubby raised Hell and wanted us to pay for the damage, but we decided if we did this, we were going to be liable for every little parking lot scrape and ding every invented. Employee decided it was best to never drive hubby's truck again!

Roberta

We are also a not-for-profit agency. Our policy is to state that the employee is responsible for his/her own damage, with the minor exception of damage caused by a client. However, the agency requires a police report and will only pay the deductible, expecting that your insurance (or you) will pay the balance. One employee had her windshield broken by a client and was unable to get anything paid by the client or the agency. Her insurance had to handle the claim.

You are right about having to deal with everybody's claim if you start. Who wants to be the judge of where/how the damage occurred? Would you want to have to deny "claims"?

Balloonman

Do you pay for any speeding tickets that they get? No, it is their responsibility, just like damage to the vehicle. Really not much different, they just see damage to the vehicle as something they did not plan on/ bargain for so someone else should pay. You think this issue is bad, wait until you have someone driving on company business who goes off the beaten path for a personal errand and has a wreck. In many cases WC will not cover it, and it will fall back on the health insurance. So just like they are responsible for having a valid DL and insurance, they are responsible for any damages that occur with their vehicle.
My $0.02 worth.
DJ The Balloonman