What Happens If You Have an Accident While Driving a Personal Vehicle for Work?

From running errands, to traveling between company locations, to driving to conferences and seminars – and more! – opportunities abound for employees to use their personal vehicles for business purposes.

It’s all good, right up until the moment when a collision occurs. Work-related crashes happen with alarming frequency, often with catastrophic results: Motor vehicle crashes are the leading cause of work-related deaths in the United States. From 2013-2020, more than 32,000 workers in the U.S. died in a work-related motor vehicle incident.

Now, to the customary worries that accompany a traffic crash — who’s hurt and how badly; what’s the damage to the vehicles — add this: Is this all on me and my insurance … or is my employer liable?

The answer will not relieve your stress – it depends.

Is My Employer Responsible for Damage to My Vehicle?

Let’s begin here: The following applies to employees only, not independent contractors, who are largely on their own. And even if you are an employee, the answer to who’s responsible in a job-related car accident depends on the circumstances.

“If you are an employee of a company, then, technically your boss/employer is responsible for any negligible acts done on the clock,” says attorney Tyler Kobylski of Chicago-based Staver Accident Injury Lawyers

Things can get murky in a hurry, however, if you’re using a personal vehicle for work and wind up in a collision. Chances are, you’ll turn first to your personal insurance carrier. Prepare for disappointment if you don’t have a rider covering commercial use of your car.

Now you’ll be looking to your employer, who — especially if it’s a mom-and-pop enterprise — may not have insurance (or its insurance may be insufficient) to cover the damages or the financial impact of injuries.

Much of it comes down to — legal term alert — vicarious liability, or the act of putting the employee’s liability onto the employer while the employee is serving the employer.

Vicarious liability can apply when you are running errands for your employer, or when you are traveling from one work site to another. Or from your place of work to an off-site work event.

Again, circumstances are everything, Kobylski says. Commuting rarely qualifies as an event that falls under vicarious liability. This exception can apply even if you’re running an errand, attending a business breakfast, or going to an off-site event. In each situation, if you left from home, your travel likely (but not absolutely) would be considered part of your commute.

If, instead, you went first to your customary place of business, or to one of your company’s branch locations, your commute will have been considered completed. In that case, errands, that breakfast meeting, or the off-site event would almost certainly fall under vicarious liability.

Murkier still, if your job requires visiting and inspecting job sites, making sales calls, picking up supplies, or many other business functions, your employer may yet be liable if you’re at fault in a crash.

In such work-related crashes, who pays for the damage to repair your car?

“Your employer may have insurance to cover [property] damages,” Kobylski says, but, in his experience, such situations are rare. “You’ll have to try a claim with your personal insurance if they don’t. This practice applies whether you’re at fault or not.

“Something to remember is that personal insurance must have collision or comprehensive coverage to cover the vehicle damages. If you only have liability coverage, damages won’t be covered.

“Additionally, your insurance company may still deny your claim unless you have a special endorsement if you’re driving a personal vehicle for work.”

Are Employers Liable for Injuries in a Work-Related Car Accident?

Injuries that result from a work-related collision bring us back to vicarious liability. “Typically, employers are insured for liability claims,” Kobylski says.

If you were driving for work (or you were the passenger of a fellow employee driving for work), your injuries would almost certainly fall under workers compensation.

Again, it all depends on circumstances. For instance:

• You’re driving a group of work colleagues to a business-related lunch. Because the event is scheduled and designed with the company’s welfare in mind, vicarious liability applies. If there’s an accident, you’re covered.
• You’re driving a group of work colleagues to a casual lunch where, no doubt, work will be discussed. Because the initial purpose of the lunch was not a work duty, it fails the test of vicarious liability. Your accident is not covered by your employer; nor are you likely to qualify for workers comp benefits.

Proving the Driver Was ‘On the Job’

Critical to getting the employer (or the employer’s insurance company) to shoulder responsibility is demonstrating the accident happened while the employee/driver was on the job. Questions that must be answered in the affirmative include:

• Did the employer benefit from the employee’s activity?
• Was the employee performing a work-related errand at the request of the employer?
• Was the employee driving from business site to business site under the terms of employment?

None of the above matters if the driver cannot meet the test of being an employee. That is, as part of his/her day-to-day work life, did the company direct what the worker does, when it will be done, and where it will be done? If so, the driver qualifies as an employee.

Who Is Responsible for Damages in a Rideshare Accident?

Among the perks of driving for companies such as Uber and Lyft: Their terms include liability coverage if they’re transporting a passenger or en route to pick up a passenger. (As Kobylski mentioned above, liability must not be confused with collision or property damage coverage.)

The rideshare company’s coverage is in addition to the requirement that the driver have a valid, active, enforceable personal auto insurance policy. And it gets complicated.

Coverage depends on the driver being actively engaged in a business activity. Ride-share drivers in accidents when they’re not available to pick up passengers, or are waiting to be hailed, are not covered.

Again, circumstances apply. “It’s important to note,” Kobylski says, “that whether the ride-share or food delivery company is liable vs. the driver being personally responsible depends on whether the court views the driver as an independent contractor or employee.”

And now we’re back where we started.