Small Business Blog
What Happens When Your Company Car Gets Into an Accident?
today at 1:26 pm
Whether you’ve been given a company car in order to carry out the functions of your job or you’re the owner of the company — and therefore, the owner of the cars your employees drive — it may have crossed your mind a time or two that an accident in your company car might be an odd situation to sort out.
While the car may belong to the company, the driver is an independent person with their own driver’s license. This begs the question, what happens when your company car gets into an accident?
While each situation is unique and the circumstances of the accident itself definitely play a role in the outcome of any car accident, you can be prepared for anything that happens in your company car.
If you’re wondering how to handle an accident in your company vehicle — whether you’re just researching or the ding has already happened — here’s what you need to know.
Did the Accident Happen On the Job?
The first question — and likely, the most important — is whether the accident happened in the course of employment. This means that it happened while carrying out a vital function of the job, during work hours.
While commuting can sometimes be considered a part of this at some workplaces, most workplaces don’t consider the commute to be company time, and therefore the employee would be liable for damages and injuries caused in the course of the accident.
Employee or Independent Contractor?
Due to the nature of the “gig” economy, whether an employee is considered an actual employee of the company by technical standards is often up for debate. Independent contractors are a form of outsourced labor — often the same as a freelancer — which means that they pay their own taxes and don’t have access to the benefits that traditional employees often do such as health insurance.
This also means that companies often don’t cover legal damages for accidents that happen, even during the vital parts of a workday. Therefore, even if the company owns the car, the employee might still be liable for damages and injuries if they’re an independent contractor.
Who Is At Fault?
Arguably, this might also be considered the most important question. That’s because it could void any conversation about liability between employer and employee.
If the accident was caused by another party or driver on the road, that entity is liable, regardless of whether the employee was on duty, off duty, carrying out the functions of the job or using the car for personal time. The same rules of the road apply, so if someone hits your company car and is at fault for the accident, they’re responsible.
When it comes to smaller damages like dents and dings, you can contact the insurance company and make claims to fix things, or you can take care of the damages yourself. Especially in situations where you aren’t entirely sure where the damages came from. Having a paint pen or suction cup on hand to deal with dings and small dents can be a lifesaver, and helps to avoid long processes with insurance.
More Serious Accidents
When it comes to more serious accidents, especially when another person or vehicle is involved, it’s always important to contact the insurance company and make sure the workplace and superiors are aware of the situation. Especially when dealing with accidents in which damages or injuries have occured, it’s important to deal with everything above-board.
Dealing With Insurance
When it comes to dealing with the insurance company, you’ll need to go one of two routes — if the employee was carrying out a basic function of the job when the accident occured, you’ll likely go through the company’s insurance completely.
However, if the vehicle was being used for personal use, the employee may need to file a personal insurance claim, as well. Additionally, the accident will likely show up on the employee’s driving record regardless of the time of the accident.
What to Do With a Company Car Accident
Really, a company car accident is just like any standard car accident. As long as nobody is hurt, you can take care of the issue and get back to work in no time at all. Whether you deal with insurance independently or on a company level, there are ways to take care of an accident in the company car.
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Martin Banks grew up outside of Chicago and covers all things small-business related, as well as the world’s best hockey team, the Chicago Blackhawks
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