Employees are often expected to run the company business and use the official vehicle, and company car accidents by the employee are common. Usually as per the employer and employee relation of companies, the coverage and responsibility for the damages caused are covered by the employer through the insurance company.
However, in not all instances of accidents do the employee bear the responsibility through the insurance company. Employees who are allowed to use the company’s vehicle should know that they are not always free. Simply because the company bears the responsibility of the car does not mean that employees can use it as they will. There might also be certain instances where the blame and liability of payment will fall on the employee’s hands.
When is the Employee Responsible
A company’s car insurance will not take responsibility and cover the employee in the following type of circumstances:
• If the employee used the car for personal activities, then the liability will not be made by the employer. Responsibility of such an act, called “frolic” is however not shouldered by the employer. Sometimes the company car is with the employee for almost all working hours. It is crucial for the employee to check the terms and condition, and clarify from the employee the extent of permission to use for personal matters.
• If the employee used the employer’s vehicle for criminal or illegal activities, in such a case, the employer has every right to deny accountability to the activity being undertaken. A cost of the accident caused during such an act will not be covered by the employer or the insurance company.
• If the employee uses one’s personal vehicle for office work/duties and gets into an accident, the employer is still not liable.
• There may also be instances where the employee is using the company car for non-business activities. For example- coming to and from office and home, dropping office staffs or for office picnics. Though the work involves office staff and related to the company, they are outside of the business hours. The employer does not shoulder responsibility of accidents during such an event.