Hired and non-owned auto
Hired and non-owned auto (HNOA) is business auto liability coverage for vehicles a business uses but does not own: rented, leased, hired or borrowed vehicles, and employees' personal cars used for work. It protects the business against covered claims for injury or property damage to others, subject to the policy's limits, exclusions and other-insurance terms.
Also called: hired autos, non-owned auto, hired and non-owned auto insurance
Hired and non-owned auto coverage answers one question for a business: who pays when someone hurts another person or damages their property while driving a vehicle the business does not own, on business? It responds to claims from other people. It generally does not pay to repair the rental car or the employee's own car, and it does not cover the employee's own injuries. The standard business auto form splits it into two parts: Symbol 8 covers "autos" you lease, hire, rent or borrow, and Symbol 9 covers "autos" you do not own, lease, hire or borrow that are used in connection with your business, according to the ISO Business Auto Coverage Form CA 00 01 (opens in a new tab).
How a claim is paid, with an example
Say a business carries HNOA liability with a $1,000,000 combined single limit per accident, the same figure a Connecticut state contract requires for owned, hired and non-owned vehicles, according to the Connecticut Department of Social Services contract (opens in a new tab). An employee on a business errand causes a crash. The damages below are illustrations.
Hover or tap a row to highlight it.
| Item | Amount |
|---|---|
| Bodily-injury damages to others | $180,000 |
| Property-damage damages to others | $35,000 |
| Total covered damages | $180,000 + $35,000 = $215,000 |
| HNOA payment (claim covered, no other collectible insurance) | $215,000 |
| Limit remaining | $1,000,000 − $215,000 = $785,000 |
| Covered damages left for the business | $0 |
The example assumes HNOA pays first. Some endorsements make it excess over other collectible insurance, such as the employee's personal auto policy, and the issued endorsement decides the order.
Coverage options and what each changes
How the coverage is built decides which vehicles, uses and costs it reaches.
- Hired auto liability only (Symbol 8). Covers liability from leased, rented, hired or borrowed vehicles. It excludes vehicles obtained from employees, partners, LLC members or members of their households, and it does not automatically pay for damage to the hired vehicle.
- Non-owned auto liability only (Symbol 9). Covers the business's liability from vehicles used in the business that it does not own or hire, including employees' and those household members' cars.
- Combined hired and non-owned. Both symbols, or one combined endorsement.
- Any auto (Symbol 1). Broader than Symbols 8 and 9, because it applies to any auto for liability, subject to the policy terms.
- Hired auto physical damage. A separate selection, endorsement or deductible that addresses damage to the rented vehicle itself.
- Limits. Contract examples include $500,000 per occurrence in a lease filed with the SEC (opens in a new tab) and $1,000,000 per occurrence in the Connecticut contract above. These are contract requirements, not standard amounts.
- Primary or excess. The endorsement states whether HNOA pays first or only after other collectible insurance.
- Driver and use limits. A policy may restrict coverage to business use, permitted drivers, territories or certain vehicle classes.
A higher limit or a broader covered-auto symbol can raise the premium, and the insurer's rating rules, your operations, vehicle use, employees and loss history set the amount.
Commercial auto insurance is the broader category. HNOA can sit inside a commercial auto policy or be added to a general liability insurance policy, while a commercial auto policy may also cover owned vehicles, physical damage, medical payments and uninsured motorists, according to the NAIC (opens in a new tab).
Where you will see it on business paperwork
The term shows up on business auto quotes and declarations pages, often as covered-auto Symbols 8 and 9, and on general liability quotes or endorsements. The insuring agreement, exclusions, conditions and other-insurance clauses set how it works. Customers, landlords and contract partners often ask for it on a certificate of insurance, and it also appears on binders, renewal proposals and claim letters. A certificate summarizes coverage; the endorsement and declarations decide the claim. It does not belong on life, health, pet, homeowners, renters or condo policies, and a personal auto policy that covers some rental or permissive use does not create business HNOA coverage.
Questions to ask an agent or insurer
- Does the policy include both hired and non-owned auto liability, or only one? Rented or borrowed vehicles and employee-owned vehicles fall under different definitions.
- What liability limit applies, and is it per accident, per occurrence or aggregate? A $1,000,000 per-occurrence limit is not the same as a $1,000,000 annual aggregate.
- Is HNOA primary or excess? An excess endorsement can depend on the employee's personal policy responding first, and if that policy excludes business use, there may be nothing underneath it.
- Does it pay for damage to a rented vehicle, or do I need hired auto physical damage or a collision damage waiver? Liability for someone else's property is different from coverage for the car you rented, according to the NAIC (opens in a new tab).
- Are deliveries, passenger transport, employees' personal vehicles and all locations covered? Definitions, exclusions, driver rules and business-use conditions can narrow the protection.
Frequently asked questions
Four short answers on HNOA.
Does HNOA cover an employee's injuries in the crash?
Generally, no. HNOA addresses liability for injury or damage to others, and an employee's work injury may fall under workers' compensation insurance, personal injury protection or medical payments coverage instead.
Does HNOA cover personal trips in an employee's car?
The non-owned auto definition ties coverage to use in connection with the business. A trip that is personal may fall outside the insuring agreement, so ask how the policy treats mixed or after-hours use.
Is HNOA required by law?
There is no general nationwide HNOA mandate. State financial-responsibility laws require auto liability for particular vehicles or uses, and contracts, landlords or customers may separately require HNOA. Get the required limit in writing.
Does HNOA cover a rental car?
It may cover the business's liability while a rental car is used for business, if hired auto coverage applies. It does not automatically cover damage to the rental car itself, which takes hired auto physical damage, a collision damage waiver or a rental-company protection product.