Equipment & Production Insurance

A service of United Agencies, Inc

Differences Between Hired Auto Liability & Hired Auto Physical Damage

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As we shared in an earlier post, one of the most common items our clients use in their productions are vehicles.

Rental cars let you store equipment, transport a crew or keep your gear safe in between shoots. Even though we recognize the significant part cars play in our productions, we don’t cover them with the right insurance. Sometimes you can get insurance coverage from the rental business providing the vehicles, but those policies lack adequate coverage. They are only interested in covering the interests of the rental location.

It’s always best to have your own insurance policies in place. There are two types of coverage you should consider: Hired Auto Liability and Hired Auto Physical Damage. We offer both as part of our short-term policies and annual policies.

hired auto liability insurance for rental carHired Auto Liability Insurance

Hired Auto Liability Insurance covers any injuries or property damage that your rented vehicles might cause to others.

If you rear-ended somebody, then this policy covers damage done to that other party. This insurance is typically the most critical coverage for most rental houses. If you totaled their vehicle without insurance, they probably have insurance to cover the costs. However, if you accidentally hit a pedestrian with their car, that’s a different story. Both you and the rental agency could be looking at a million dollar claim pretty quick. Consequently, most rental locations demand Hired Auto Liability Insurance.

Hired Auto Physical Damage Insurance

A Hired Auto Physical Damage policy covers damage done to the vehicle itself while you rent it.

Sometimes the company renting the vehicle to you will give you the option to go under their insurance for this type of coverage. However, it’s always best to have your policy. Plus, if you rent a lot of vehicles, it’s cheaper to get our policy then it is to pay extra money for their coverage every time you rent.

You should also keep in mind that this coverage also applies to vehicles that are owned by your employees. If you tell your employee to get in their car and pick up some pizza to bring back to the set, they could theoretically get in an accident and try to put the claim through your policy. Sure, their policy would still be primary, but we see a lot of claims from inexperienced PA’s or actors who get into a fender bender while on set and try to put the claim through the production company. If you are trying to only rely on the insurance from the rental houses, they aren’t going to extend coverage to these kinds of claims.

We all use cars for our productions. Even if you aren’t officially renting one for your shoot, your crew is going to be using their vehicles to get around. You want to make sure that you and your company are properly insured, so make sure to ask us about Hired Auto Insurance for your next shoot!

 

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Production Insurance Claims: True Story – Hired Auto Liability Claim

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One of the biggest complaints I receive comes when a location or a rental house ask my client to add Hired/Non-Owned Auto Liability (HNOAL) coverage to their policy. The client doesn’t feel it’s fair that they’re being asked to provide coverage for vehicles when there are no cars or rentals involved in their production. They always tell me that since there isn’t any exposure, then there’s no point in them wasting their money. What is the point of having HNOAL if you won’t ever need to make an auto liability claim?

auto liability claimWhy You Need Hired/Non-Owner Auto Liability Insurance

I’ve seen several HNOAL claims in my career, and most of those were from clients who didn’t want to buy the Hired Auto Liability Insurance.  Granted, most of those auto liability claims were small. For instance, a PA or intern gets in a car to go get some pizza or pick up a piece of gear, and they hit somebody on the way.

The intern argues that they were working for the production while on this trip. This means the auto liability claim falls under the HNOAL policy that’s in place. Sometimes the claim goes through their personal policy first and then your policy HNOAL as a secondary. However, the state minimum coverage in California for auto liability does not cover expensive damage or injuries. The law only requires $15k for injuries to others, with a $30k maximum per incident, and a $5k limit on damage to property. 

Those amounts don’t stretch very far if there is a big injury or if they totaled a nice vehicle. That’s when your HNOAL coverage comes in and covers the remainder of the auto liability claim.

True Story – Auto Liability Claim

I had a claim a few years back, which illustrates the need for HNOAL. Somebody was asked by the police to back a parked truck out of a spot and move it around the corner. They sent an inexperienced PA to move the truck. After all, what could go wrong if you’re just moving it around the corner?

Of course, the PA didn’t know how to drive a bigger vehicle and he backed right into the police cruiser! It turns out that LAPD was really easy to work with on this auto liability claim. We only ended up paying around $7k in damage to fix their vehicle. However, the driver’s personal insurance didn’t extend to a vehicle of this size, so his personal insurance never paid a dime.

There are lots of times when people think that auto liability coverage is only meant to cover vehicles that will be on camera, or that will be officially rented, but that’s not the case. Often these auto liability claims happen behind the scenes, and they occur because people are being careless.

Make sure you call me about adding HNOAL coverage so this stuff doesn’t happen to you!

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