Accidents involving company cars, trucks, and other vehicles present several legal questions:
- Who’s responsible?
- Whose insurance company pays?
- What benefits are available?
- What’s the role of workers’ compensation insurance?
- What role does negligence play?
This section answers these questions and covers legal issues related to company vehicles, car accidents at work, and on-the-road injury claims.
The relationship between employers and employees who drive company vehicles falls under the legal doctrine of respondeat superior. This means employers are legally responsible for the actions of their employees while “acting within the scope of their employment.” The employer’s responsibility includes paying for injuries and property damage caused by an employee while driving a company vehicle.
When an employee is driving a company car, truck, or other motorized vehicle, usually the employee is acting within the scope of his or her employment. This includes making deliveries, driving to and from off-site jobs, driving to and from work (with the employer’s permission), and using the company vehicle while pursuing other job duties.
The doctrines of respondeat superior and acting within the scope of employment apply particularly to accidents involving company vehicles. When an employee’s negligence causes another person’s (third party) injury or property damage, the employee and her employer may be held liable. Third parties include drivers of other vehicles, their passengers, passengers in the company vehicle, and bystanders.
In most cases of car accidents at work, the employer’s liability insurance indemnifies the employee against third-party actions. This means the employer’s insurance company protects the employee so he doesn’t have to pay damages to injured third parties.
Damages can include medical bills, out-of-pocket expenses (for medications, bandages, crutches, etc.), lost wages, and pain and suffering. Indemnifying an employee also means the employer’s liability insurance pays the employee’s legal fees if a lawsuit is filed against him by injured third parties.
Example: Car accident while making sales calls
Jon used his company car to make sales calls across the state. One evening while running late for an appointment with a customer, he collided with another car. The driver of the car suffered a whiplash injury and property damage.
Jon’s employer’s commercial insurance paid for the injured driver’s injuries and property damages. Hoping to “double dip,” the injured driver sued Jon personally. The employer’s insurance policy stepped in and provided an attorney at no cost to Jon.
An exception to employee indemnification applies when the employee is committing a crime while driving a company vehicle. If the accident involves criminal action, the employer may rightfully refuse to indemnify the employee from third-party lawsuits.
Additionally, if the employee was injured while committing a crime (other than traffic offenses), workers’ compensation may rightfully deny coverage for the employee’s medical bills, out-of-pocket expenses, and lost wages.
Workers’ Compensation vs. Liability Insurance
Liability and workers’ comp are two different types of insurance:
Workers’ compensation covers an employee injured while driving a company vehicle (within the scope of his employment). Coverage can include reimbursement for the employee’s medical bills, out-of-pocket expenses, and a portion of his lost wages. Workers’ comp does not pay for pain and suffering. If an accident at work is serious enough to result in disability, workers’ comp will also pay a settlement award.
Liability insurance pays for damages sustained by third parties. Under the employer’s commercial liability policy, coverage may include standard damages plus an additional amount for pain and suffering; however, if passengers in the company vehicle were employees, they’re only entitled to workers’ comp benefits (but if the passengers were aiding and abetting the driver in a criminal act, they all may be denied workers’ comp).
Example: Broken leg in car accident at work
Paula was using a company van to deliver flowers when another car illegally crossed an intersection and collided with her. Paula sustained a broken left femur, and she filed a workers’ compensation claim. Workers’ comp paid for her medical bills, out-of-pocket expenses, and about two-thirds of her wages while she was recovering.
Paula wanted to be compensated for her pain and suffering, but state laws governing workers’ compensation do not permit it.
Example: Employee and hitchhiker injured
Jack was driving a company car to a business meeting. While en route, Jack pulled over and picked up a hitchhiker. As Jack pulled back onto the highway, he collided with another car which had the right of way. Jack and his passenger were injured.
Jack successfully sought coverage under his employer’s workers’ compensation policy. His passenger successfully sued Jack’s employer under his commercial policy. As part of their verdict, the jury awarded Jack’s passenger compensation for her medical bills, out-of-pocket expenses, all her lost wages, and an amount for her pain and suffering.
Injury Due to Negligence of a Third Party
When an employee driving a company vehicle is injured due to the negligence of another driver (a third party), the employee is entitled to damages under his employer’s workers’ comp policy AND under the other driver’s liability insurance policy.
Unlike workers’ comp benefits, which only pay a portion of an injured employee’s lost wages (and nothing for pain and suffering), the third party’s liability insurance will pay all the employee’s lost wages, and an amount for pain and suffering.
If the employee-driver receives workers’ comp and also gets compensation from the third party’s liability insurance, the employee will probably have to reimburse workers’ comp. Since workers’ compensation benefits don’t include pain and suffering, and only pay two-thirds of lost wages, the injured employee can keep the award for pain and suffering and any amount in excess of the partial wage payments.
Example: Suing a negligent driver outside of workers’ comp
Sally was driving a company van delivering meals to elderly citizens. Another car collided with the back of the van, and Sally was seriously injured. She received workers’ compensation benefits and retained an attorney to sue the other driver for negligence. The negligent driver settled Sally’s case by paying her medical bills, out-of-pocket expenses, all her lost wages, and a substantial amount for her pain and suffering.
Under state law, Sally had to reimburse the workers’ comp insurance company for the benefits they paid her. She was able to keep the portion of the settlement representing her pain and suffering, and the portion for lost wages above her worker’s comp benefit.
Injury to a Third-Party Driver
Some jobs require an employee to use his personal vehicle, such as outside sales, pizza delivery, and home health care. Vehicle accidents that occur in an employee’s own car present coverage questions. His private insurance company may deny coverage for any injuries and property damage he causes.
To avoid denials, either the employer’s commercial insurance policy must cover such events, or the employee must purchase a “rider” from his insurance company.
A rider is an addendum to personal car insurance that provides coverage in case of an accident while using the car for company business. Purchasing a rider usually increases premiums, and some employers are willing to reimburse the additional cost. Without a rider, the employee’s insurance company can deny coverage and leave him personally liable for any damage he causes.
A rider may not be necessary if an employer provides coverage under her commercial liability policy. The employer should provide proof of insurance or a copy of her commercial policy. If she refuses or says it’s not available, the employee should assume he’s not covered. Having a car accident at work without proper coverage can be disastrous, so he’d be wise to consider other options.
If an employer permits an employee to drive a company vehicle to and from work each day, her commercial insurance should cover property damage and personal injuries even when the employee isn’t actively working. In any case, criminal activities while using a company vehicle may void coverage.
An employer’s commercial policy may cover her employee’s personal vehicle while he’s working, but not when he’s commuting to and from work. Accidents that occur outside of the workplace, while commuting to and from home, or when driving between job sites, may not be considered acting within the scope of employment.
To ensure coverage during these times, the employee must ask his employer to provide coverage or purchase a rider to his own personal car insurance policy.
Example: Rider to personal insurance policy
Aidan used his own car to make pizza deliveries for a national pizza franchise. In compliance with corporate rules, Aidan provided his employer with proof he purchased a rider to his car insurance policy. The rider insured Aidan for up to one million dollars against third-party injury claims. The company reimbursed Aidan for the additional cost of the rider.
Example: Employer-provided coverage
Rebecca drove her car to deliver pizzas for another national franchise. The company provided her coverage for up to one million dollars under their commercial liability policy.
Example: Insurance denies coverage for work accident
Justin used his car to drive from one work site to another. In the morning, he drove from home to the worksite designated by his employer. At the end of the day, Justin drove his employer from the worksite to the main office. One morning, while driving from his home to the worksite, Justin changed lanes too quickly. He collided with another car, causing it to crash into an abutment. The driver and passengers were injured.
The injured third parties sued Justin’s employer, alleging Justin was acting within the scope of his employment at the time of the crash. His employer’s commercial liability insurance denied the claim, saying Jack was not acting within the scope of his employment.
In this case the court ruled in favor of the third parties. The court stated Justin’s commute each day to various job sites was within the scope of his employment. If Justin had used his car only to drive between his home and his employer’s headquarters, then the accident would not have been within the scope of his employment.
Plaintiff Wants More Injury Compensation
In this accident case, the plaintiff asks for damages over and above the normal workers’ compensation payments, but he fails to present enough evidence to convince the court.
Fraudulent Auto Insurance Claims
In this case, a major insurance company is defrauded by a group of individuals claiming false injuries from bogus car accidents. The District Attorney’s office is involved and criminal charges are filed against the perpetrators.
How Much is Your Injury Claim Worth?
Find out now with a FREE case review from an attorney…
Visitor Questions on Common Causes of Work Injuries
Search for a Previously Answered Question
My boss and I were driving back to our office after finishing a photoshoot. On the way back, a semi-truck attempted an illegal u-turn using an emergency vehicle-only path. We were passing him at the time, so when he started the turn, we hit him. The driver was found at fault. I went to the... Read More.
I was rear ended while driving the company van while at work. I filed a Worker’s Comp claim and a third party claim against the at-fault driver’s insurance company. I have not received any money from either company. I used my PIP from my car insurance to pay for my medical bills. My PIP paid... Read More.
I was working as a delivery driver for my company when I was rear ended by a sugarcane truck on the interstate. The other company’s insurance adjuster met with me later that day to settle. I took it because I was having money trouble at the time. Then I started getting workmans’ comp from my... Read More.
I work for a home health agency and have company car, which I am expected to drive. I seldom go to the office, rather I go between patients’ homes. I’m expected to work between 8a-5p, and have to sync my computer every day before I can see patients. While driving the company car, I was... Read More.
I was rear ended by a lady while in my company vehicle. Myself and several other employees were injured. I talked to the lady’s insurance and there was no issue with us all going to a chiropractor to get treatment. Four days later the insurance company contacted my corporate office and said they are going... Read More.
My father works for a taxi company in Natick, MA. The company provides a vehicle, usually the same for each driver, for use during the shift. My father was involved in an accident earlier this month. While attempting to change lanes, he did not see an approaching vehicle in the lane, and collided with the... Read More.
A year and 4 months ago I was hit by a drunk driver who ran a red light. I was driving a company car at the time. After the accident my boss told me to go to a certain attorney who he said does all his legal representation. He said if I didn’t go to... Read More.
My company was not qualified for a loan to purchase a car, so they used my boss’s title to finance a car under his name, and afterwards purchased the insurance on the car using his name as well. On November 24th, my boss gave me his car key to perform a work related task, which... Read More.
I was driving my personal vehicle that only has liability insurance while working. There was an un-barricaded, unlit highway that was flooded. I couldn’t see very well and drove my vehicle into the flooded area, totaling the vehicle and it’s contents (including work equipment). Is there any chance that my employer’s insurance could/would cover the... Read More.
My teaching assignments require me to use my own vehicle to travel to various locations when not teaching at the organization’s headquarters. While traveling to an assignment, I was in a rear end accident on the interstate highway and my vehicle was declared totaled. I will have to spend several thousand dollars to replace the... Read More.
I live in Colorado and am a nanny. I was driving the children and one of their friends from school to after school activities and ran a red light. I hit another car. No one was injured but both cars were damaged. I was driving my employer’s car, which they provide for my use when... Read More.
I was driving a company car on my way between 2 of our company’s locations for a meeting. This was on work time. I was hit by another car and my car was completely totaled. I was taken to hospital for injuries. I also had a car seat and a bike in my car at... Read More.
This concerns an accident between two employees driving work vehicles in the company parking lot. Vehicle one was backing out of a parking spot, vehicle two went to go around vehicle 1 and they collided. Both drivers were given post-accident drug tests. Vehicle 2 driver tested positive for drugs. Should Vehicle 1 driver be held... Read More.
I would like to know what happens to personal insurance premiums and driving records when someone has an accident in a company car in Maryland. I was involved in a minor car accident while driving the company car (with authorization). Even though the company car is insured by the company, since the accident was so... Read More.
I am a current employee of a small car dealership group (7 stores) and I recently backed into another vehicle on the lot. I have been with the company for just over one year and have not had any problems or previous accidents. When this happened my manager, albeit nicely, took the stance that because... Read More.
I was the first car stopped at a red light, and was struck behind from a sedan and a commercial box truck. The NYPD was called, and a Police Report was generated. I went to the hospital emergency room the same day. Also, I informed my employer the same day of the work-related accident in... Read More.
While at work I was hit by a car driven by a coworker and was injured. The car the coworker was driving belonged to a friend of his who allowed the coworker to borrow the car. This friend does not work with us and is not a coworker of mine. I understand that I can... Read More.
On 4/17/14 I was driving a company vehicle while working for a recycling company. Two vehicles in front of me suddenly stopped a few feet going into an exit. I rear ended a mini van with the company truck. On 9/5/14, the company closed and I just received a letter today from an attorney representing... Read More.
While maneuvering a loaded flatbed through my job site, I backed into the back of my own car. There was zero damage to the company truck and about two grand worth of damage to my car. Sedan vs. steel, ding. My employer wants me to go through my own insurance, but I believe, through respondeat... Read More.
In 2009, I was involved in a car accident while traveling to work in another state. I was going to cross a double yellow line coming out from a gas station. I only made it past the first dashed white line of of a double two lane highway and was hit by a person traveling... Read More.
I was in an accident while working for a Subaru dealership. I was given keys and told to get gas in the car, but got into an accident at the gas station. It was my fault, though it was a dark rainy day when it happened. Several weeks later I found that my company’s insurance... Read More.
I was on my way to work (at a job I was forced to “willfully resign”) when a vehicle hit me. The workers’ comp forced me to see an incompetent MD. I had one visit only, then sought care on my own and paid out-of-pocket. The bills were getting to be too much, so I... Read More.
I was working and driving a company van when I was in an accident. I am covered under the company’s insurance policy. I was hit from behind and the other driver admits he’s at fault. Am I supposed to file a lawsuit against the driver that hit me? Do I file a claim with my... Read More.
I was traveling out of town (from Utah to Montana) in my own vehicle, to a job site required by my employer. I got into a car accident on my way to the site. Is this auto accident covered by my employer since it is not my normal job site? Or do I have to... Read More.
My husband was loading trash into the company vehicle, while on duty, when a board slipped and hit the gas pedal. The cart (vehicle) jumped forward and hit another vehicle. My husband tried to stop the cart from moving forward and was injured. His employer is telling him now that his personal insurance would be... Read More.
I deliver automobiles as a commercial truck driver for a the company, which is leasing the delivery truck I drive from the owner. The lease agreement doesn’t state my boss is paying insurance or responsible for insurance. The truck owner is responsible. I had a delivery, which I dropped, and was unsure where to turn... Read More.
I was driving a company vehicle when I was hit by a drunk driver. My employer laid me off, saying it was for disciplinary action, 35 days after the accident. My unemployment is now being denied. I really believe my former employer didn’t have auto coverage on me, as he asked for a copy of... Read More.
I was rear-ended by a fellow employee while at work. I was in a work vehicle, stopped at a stop sign and she was in her friend’s private vehicle on work grounds. She rear-ended me causing me personal injuries. I received workers’ compensation benefits. I was also wondering, can I sue her private insurance for... Read More.
I am a Home Hospice Nurse in Georgia. I had clocked in via telephone (as usual) and I was driving on my way to a meeting at one of our facilities when I was rear ended while stopped at a red light. I immediately notified my Manager whom informed me to go by Employee Health... Read More.
I was working as a temp with this day laboring company, who assigned me to work with a company doing highway work. My job was to set out the cones for traffic patterns. We were heading back to the spot where the electronic traffic signs were located, when the guy I was working with attempted... Read More.
I left my job while I was still on the clock and went home for my fifteen minute break. During that break while traveling I was in a bad car wreck. Do I qualify for workers comp benefits for my injuries from this accident? Read More.
I was involved in a motor vehicle accident while driving a company vehicle in Texas. The accident was not my fault. All my medical bills are being taken care of by worker’s compensation. Do I still have a claim under my own Personal Injury Protection (PIP) policy with my auto insurance? Read More.
My job is to drive from site to site for my employer and assist the staff when short of people. One day while leaving a site headed to another I was rear ended in my vehicle. My back was injured and now, 6 months after the accident (and numerous epidural and cortisone shots), I was... Read More.
If I am not considered an independent contractor while delivering products for my employer, and they require me to use my own vehicle for the purpose of delivering said goods, is there any legal precedence that they are required to provide coverage of my vehicle if it is wrecked in the course of my job... Read More.
I was pushed forward by a car and “hyper extended” my toe…or so the doctors told me. I had x-rays and spent a good month or two between doctors and physical therapy. All of this happened 3 years ago and was considered a workmans compensation claim. My toe has bugged me since then off and... Read More.
I’m on Workman’s comp for a car accident while I was on the job. I’ve been getting weekly checks and not had any real problems so far. My doctor has put me on full duty Monday, Wednesday, and Friday. I’m on limited duty Tuesday, Thursday, and Saturday. My question is, should I still be receiving... Read More.
Over 11 years ago I had an accident. I was working for waste management and while I tried to pull myself up to the truck I fell down and got dragged by the truck for about 2 blocks. I was hospitalized, in coma for about 9 hrs and in the ICU for about 2 days.... Read More.
I was in the passenger side of the vehicle going from one job to another and my boss was driving. He ran a red light causing us to be broad sided on my side. He told me to use workmans comp and go to the emergency room. I’ve been told I need physical therapy and... Read More.
I was moving a 4 ft piece of 10 inch pipe when I injured my back at our pipe shop. I have a bulging disc at L4-5, and a 10x5x10-mm left paracentral disc protrusion mildly deforms the anterior thecal sac. This extends to the left descending S1 nerve root. I received treatment from workers comp,... Read More.
I was parked at a taxi stand in my leased taxi cab. A car, for a reason I don’t know, hit me. The cab had enough damage to be totaled. I have physical therapy ongoing for shoulder, back and neck pain. I drove myself to a hospital for the ‘soft tissue injuries’. Would you be... Read More.