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?
Why 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!