Nonprofits Insurance Alliance

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Use of Non-Owned Autos

Does your nonprofit have employees or volunteers that use their personal vehicles on behalf of your organization, for purposes such as running errands, performing services, or transporting clients? Many nonprofits do not realize that their organization has an additional and potentially serious exposure to loss that arises from employees and volunteers using their personal vehicles. Unfortunately, this is a situation where what you don’t know may very well hurt you!

Your organization can be held responsible for any liability associated with operating that vehicle, since it may be held responsible for the actions of employees and volunteers during the course of service or employment. Although the individual has personal insurance to cover their own liability, that coverage may not be adequate to cover the full extent of damages incurred, in which case a claimant may then pursue your nonprofit.

If you have any individuals driving a personal vehicle on behalf of your nonprofit, even for short errands, at a minimum you should:

  • Have a written driver policy, which is signed by the individual driver (a sample policy is available on our secure site for current members of the Group)
  • Require that individuals have an authorization from your nonprofit before driving a personal vehicle
  • Get a copy of the employee’s current driver’s license
  • Require proof of personal auto coverage and get updated copies at each policy renewal
  • Purchase a non-owned auto insurance policy for your nonprofit

Accident claimants and their lawyers will seek recovery from as many sources as they can, so don’t leave your nonprofit vulnerable! Non-owned auto coverage applies when damages exceed the vehicle owner’s personal auto insurance limits, or in situations where a vehicle owner’s primary coverage declines a claim. We have seen both large and small claims related to non-owned auto use, one of the largest being $2 million. Without a non-owned auto policy to protect them, that nonprofit would likely not have survived.

For better risk management, also consider running an annual motor vehicle record check or use a “DMV pull program.” This is highly recommended for organizations that have a significant non-owned auto use related to the delivery of services (e.g., meals on wheels; neighbor-ride programs). Knowing more about this exposure and implementing some simple risk controls can help protect your nonprofit from financial loss.

 

Distracted Driving

Distracted driving is any activity that diverts attention from driving, including: talking or texting on the phone; eating and drinking; talking to people in the vehicle; fiddling with the music, entertainment or navigation system. It is anything that takes attention away from the task of safe driving.

Any non-driving activity is a potential distraction and increases the risk of being involved in a crash. The National Highway Transportation Safety Administration (NHTSA) estimates that 25 percent of all crashes involve some form of driver distraction, and thousands of people are killed each year in those crashes. Sadly, every single death is 100 percent preventable.

The best way to be ready for the unexpected is to minimize driver distractions. While no state has a law prohibiting all cell phone use while driving, employers are putting policies into place banning the use of both handheld and hands-free devices. Your organization should have a written distraction-free driving policy. It can be a stand-alone policy or an element of a vehicle use policy. Your distraction-free driving policy should apply to all individuals driving on behalf of your organization, whether an employee/volunteer is driving your agency-owned autos or their personal vehicles. (Sample vehicle use policies are available on our secure website.)

Why should you consider implementing a best practice, distraction-free policy? Juries all over the country are reacting very strongly to distracted driving cell phone crashes. They are awarding very large damages amounts. A jury in Texas, for example, found a beverage company liable after one if its drivers crashed while talking hands-free. The hands-free headset complied with company policy. One injury – verdict $21 million.

Distracted Driving Background

The National Safety Council has reviewed more than 30 studies that show that using hands-free devices doesn’t make driving any safer because the brain remains distracted by the conversation. A study by the Virginia Tech Transportation Institute in 2013 found that impairments associated with drunk and/or drugged driving and texting while driving are similar. Both cause distraction than can result in behaviors such as following too closely, driving slower than the speed limit, weaving into oncoming traffic, lane drift, and not being able to brake on time.

Think that distracted driving isn’t as bad as impaired driving? In 2013, Car and Driver Magazine performed an experiment to document just how dangerous texting and driving can be in comparison to impaired driving. They tested how long it would take to hit the brakes when sober, when legally impaired at a BAC level of .08, when reading an email, and when sending a text. Results: the sober drivers took an average of .54 seconds to brake; the legally impaired drivers took an additional four feet; 36 additional feet for those reading an email; and 70 feet for those sending a text.

Did you know that at 60 mph a vehicle travels 88 feet in one second? At that speed, if a driver takes their eyes off the road for two seconds they will have traveled blindly (yes, like driving with their eyes closed) for 180 feet or more than half the distance of a football field. Stopping that vehicle will take more than four and a half seconds.

Driving safely on today’s roadways is a demanding task that requires constant attention. Employees and volunteers need to stay focused and keep their mind on the road. Just one second of a driver’s attention is all it takes to change a life forever.

 

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