One of the reasons driving a company car is such a huge fringe benefit is that it takes away a lot of the responsibility of driving your personal car. If you have a car accident in a company vehicle, the line of responsibility becomes less clear. In Maryland, the at-fault driver pays damages to the other driver. Under some circumstances, the employer may be liable for the damages in an accident caused by their employee.
How Company Vehicles Work
Some businesses give employees a car allowance for the time they use their private vehicles while performing company business. This is often a better solution for those employees who spend more time behind the wheel for personal use than for their employer.
The employee must have liability insurance on their car that covers the personal use of their vehicle. In addition, their policy must cover the time their vehicle is used for business. If it doesn’t, they need to purchase a rider that expands on the basic car insurance. Otherwise, the insurance company is likely to deny your claim.
Employers who spend a lot of time behind the wheel in the line of business usually prefer driving a company car. They don’t want to add a lot of miles and wear-and-tear to their personal vehicle.
The types of vehicles and the conditions of use vary from company to company. Some businesses allow employees to drive company cars for both personal and company use. Others have strict limits on the number of miles the employee logs. Some employers even install software in the vehicles that keeps driving records for them.
One reason the distinction between business driving and personal use is so important is for tax purposes. A company car is considered a fringe benefit that isn’t taxed during work-related use. However, the employee must pay taxes on the portion of driving related to personal use. For an employee who makes a twenty-mile trip once a week for the company, driving a company vehicle full-time probably isn’t worth it.
If you have a car accident in a company vehicle, it matters too. The matter of responsibility for damages depends on whether you are acting within the ‘scope of your employment duties’ when the accident occurred. This is the most important factor when determining who is responsible for the damages caused by an accident.
The liability in a car accident isn’t assigned to the person in possession of the vehicle. Instead, it is a matter of ‘respondeat superior,’ which means the employer is liable for the actions of an employee acting on his behalf. This extends to paying for injuries and property damage.
Scope of Employment
The scope of employment depends on the types of driving the employee performs for the company. Some examples include:
- Making Deliveries
- Traveling to Other Branches or Worksites
- Picking Up Supplies
- Contacting Customers
- Attending Meetings/Conferences
- Driving to Work or Back Home
The employer is not liable if the accident occurs while the employee is going shopping, dropping the kids off at school, or while running any other personal errand. Also, the employer and employee should know what is and isn’t covered under their commercial policy. For example, some policies don’t cover the distance between work sites or for the commute to and from work.
Where Does Workers’ Compensation Fit In?
Employers are required by law to buy workers’ compensation insurance. This coverage pays employees injured on the job for medical treatment, out-of-pocket expenses, and about 2/3 of their lost wages.
It is essential that employers obtain liability coverage for their employees that drive company vehicles. Car accidents often result in severe injuries that cost a great deal to treat. The compensation from workers’ comp often falls short of the total cost of treatment. This is especially true for employees who find they are no longer able to work.
Some types of injuries are also excluded from workers’ comp coverage. Liability insurance protects the employer and the employee when a third-party receives damages. It covers pain and suffering along with standard damages to property and to their body. Liability also covers the difference between the partial wage loss offered by workers’ comp and the entire amount of lost wages.
Keep in mind that you may have to use money from a lawsuit or liability claim to repay workers’ compensation. Laws regarding workers’ compensation vary by state. Contact a workers’ comp attorney in your state to learn about your rights and obligations.
What to Do After a Car Accident in a Company Vehicle
– Regardless of where the accident takes place or who was at fault, the first step is always to make sure everyone is okay. If possible, move the vehicles out of traffic and off the side of the road. Don’t encourage anyone with back or neck pain to move. Call for medical help if needed.
– Call law enforcement to the scene. An accident report will support the facts of the case and help prove fault if you file a lawsuit.
– Exchange contact information, insurance information, driver’s license numbers, vehicle tag numbers, and basic insurance company information with the other motorist(s).
– Use your phone to take pictures of the damages, contributing factors (such as road signs, traffic lights, road construction, etc), marks on the road, alcohol containers, and anything else that might provide clues to what caused the accident.
– Gather the names and contact information of any witnesses.
– Don’t claim fault for any portion of the accident or make statements about your injuries or lack of them.
– Write down every detail about the accident that you can remember.
– Get medical treatment and make sure every test and treatment is documented.
– Contact a car accident attorney for a case evaluation.
When to Get a Car Accident Attorney
Legal issues involving state and federal laws, liability, and scope of employment are often very confusing to the average person. The steps you take immediately after a car accident in a company vehicle can change your options.
Maryland’s comparative negligence rule is a good example of how state laws affect the impact of your accident. This law means that you can’t collect compensation for your injuries if you are even 1% at fault for the accident.
The decision to contact a car accident attorney should never be based on assumptions. While states often have very harsh laws, there are usually exceptions that apply to every case. Issues like determining fault and establishing the scope of employment commonly present challenges. Obtaining fair compensation is rarely a straightforward issue that doesn’t get challenged.
Personal Injury and Negligence
A personal injury is one that occurs to the person and not to their property. It results when another party is negligent. When driving a company car, the other driver is considered a third party whether it is you or them who is injured. If you injure a third-party due to negligence, your employer’s liability coverage can protect you from a lawsuit.
When the third party is at-fault for the accident and your injuries, you have the right to obtain damages under the other driver’s workers’ compensation policy as well as under their liability insurance.
If you are injured in an accident caused by a third-party, you have the right to collect compensation for all of your damages. Start by reporting the accident to your employer and file a workers’ comp claim. You should also see a car accident attorney about filing a personal injury claim.
Exceptions to the Rules
In most cases, the employer’s liability insurance ‘indemnifies’, or protects the employee from third-party legal action. One exception to the rule is when criminal action is involved. The employer has the right not to indemnify the employee and leave them open to third-party lawsuits. If the employee is injured during a criminal act, workers’ compensation may also deny coverage.
If you have a car accident in a company vehicle while other employees are passengers, they aren’t entitled to benefits under the employer’s liability policy. Passengers who are also company employees are only entitled to workers’ comp. This coverage can also be denied if they participated in a criminal act at the time of the accident.
Dealing with Insurance Companies
The workers’ compensation process, personal injury claims, and car insurance all have one thing in common: They all start and end with the insurance company.
Most insurance companies are enthusiastic about selling you coverage for almost anything and everything imaginable. Their goal is to take in as much money in premiums each month as possible.
At the same time, they need to keep as much of that money as possible to be successful. That’s why they work so hard to keep from paying out money when you need it. Insurance companies rely on a number of common tactics to keep from paying all types of claims. They rely on your lack of knowledge about the laws to fool you into thinking you deserve less or nothing at all. A car accident in a company vehicle can impact your life for a long time.
A car accident lawyer knows the tactics used by insurance companies. They also understand how vulnerable you are. For many people, serious accidents involving work vehicles mean a loss of income for an extended period of time. At the same time, medical bills continue to mount. Don’t let the insurance companies take advantage of you during this traumatic time.
A car accident in a company vehicle can result in injuries to either party. If you are injured and file a workers’ comp claim, your employer’s insurance company might dispute your claim that you were working when the accident occurred. They might even dispute that you are injured at all or that your injury resulted from the accident.
Sometimes insurance companies offer you a check or a settlement for your injuries. If you accept, it can prevent you from pursuing additional compensation, if needed, in the future. The best practice is not to talk with the insurance adjuster at all. Get a personal injury attorney who knows the value of your claim and how to negotiate with insurance companies.
The insurance company will monitor your medical treatment. They look for missed appointments or failure to obtain treatment as evidence that you aren’t seriously injured. Although your employer’s liability insurance should pay for injuries incurred during on-the-job driving, don’t expect the process to be an easy one.
The same is true if you file a personal injury case against the third-party driver. Their insurance company will try to prove that you are at least partially to blame for the accident. Since you can’t obtain compensation for injuries if you are even 1% at fault in Maryland, they have a lot to gain from casting doubt on your case.
Maryland mandates coverage of $2,500 in personal injury protection. This coverage is offered regardless of which driver is at fault. Any serious injury, and even some of those considered minor, require more money than this for treatment. Any additional amounts come from the employer’s liability insurance, the third-party’s insurance, or from suing the third-party driver.
Who Is Likely to Have a Car Accident in a Company Vehicle?
A number of factors determine the likelihood of having a car accident in a company vehicle. The type of vehicle, how it is used, and the volume of traffic driven in all make a difference. Also, the more time the driver spends in the car, the greater the risk is for having an accident.
Employers also have added liability if the company car malfunctions. They may be considered at fault if they hire a driver with a poor driving record. The only way to know for certain where fault lies is to contact a lawyer experienced in handling auto accidents to evaluate your case.
Contact Ingerman & Horwitz to schedule your free evaluation. Tell us your story about your car accident in a company vehicle. There’s no cost to speak with an experienced personal injury attorney. We know how to deal with defendants and their insurance company to get the solutions you need.
