Our claims professionals are always looking out for the best interests of all parties along the insurance process. While the following issue has not risen to the status of a claims trend, it is alarming due to the potential for a nuclear verdict.
Knowing what’s at stake by hiring a driver to work for you is something both you and your insurance professional should have discussed. However, when a carrier goes against the advice of that professional and/or operates contrary to the stipulations in their insurance contract, they are creating additional exposure that could lead to a claim of negligence.
A claim for negligent entrustment arises when one party is held liable for negligently giving someone else a “dangerous instrumentality” with which that person causes injury to a third party. This could be interpreted as an employer entrusting a driver with a vehicle with which that driver isn’t operating responsibly. It could also be interpreted as an employer allowing a driver to operate their vehicle that the driver is not qualified to operate.
A claim for negligent hiring arises when an employer knew or should have known of an employee’s potential risk to cause harm, or if the risk would have been discovered by a reasonable investigation.
Please review the scenarios below that could be labeled as irresponsible and create unnecessary exposure.
• Do you have drivers (often part-time) delivering your loads that your insurance company does not know about? You should be notifying your insurance agent about all your drivers. Your agent knows your policy better than you and if there is an issue with that driver or the policy, they will notify you of the risk or help to deal with that exposure.
• Are your drivers allowing passengers to ride along in their vehicle during on-duty time? Many commercial insurance policies have exclusions for passengers, most notably family members. If you’re not sure, ask your agent before allowing passengers and instruct your drivers accordingly.
• Do your drivers have the proper license type to operate your vehicles and is it valid? Obtaining MVRs at least annually for your drivers is a legal requirement to stay compliant with FMCSA guidelines. However, anything can change within a year, and verifying the validity of those licenses periodically is just good business practice. Drivers don’t always self-update with changes.
• Are your driver’s medical cards current? This is something to stay on top of. Should your driver have a medical event while driving that would have excluded them from being behind the wheel, you could have a claim that will quickly escalate.
You and your insurance professionals are on the same team and need to be on the same page with your operational exposure. If you are ever in doubt about coverage, don’t just chance it, give them a call.