Expert: Richard Hixenbaugh - 10/12/2009

Question
I work in an office building that has an onsite car wash company come 2 times a week. Last week, I handed the keys over to the owner of the company and he drives my car only 20 feet and BAM runs into a concrete pole! He has been extremely helpful and trying to make things right. Now his General Liability Insurance is saying they do not cover him because he was driving my car. Well he was acting within the scope of his employment when he wrecked my car and I dont understand the problem. General Liability insurance is to cover property damage that may be caused by doing their job. That is why they have it. His insurance is saying he needs Commercial Auto insurance which is for company vehicles. This is not fair to have this run around. Am I not correct that his General Liability policy should cover him because he was within the scope of his employment when he wrecked my car?

Answer
Hi Randi,

General liability insurance generally covers his premisis if he has a business location. For the type of business he does he would have to have Garage keepers liabilty or a specific endorsement on the policy that covers him to drive customers vehicles. Either way it does not matter. The driver is liable for the damage to your car. At this point you have a couple of choices as follows:

1) You can get an estimate of the cost of the repairs and present it to the car wash owner and demand that he pay it along with any other damage that is found during the repairs and a rental car during the repairs.

2) you can have your own insurance company pay for the repairs and they will go after him for reimbursement

3) you can file suit against the car wash owner for all of your damages including the cost of repairs and rental car.

Other than these choices there is not much else you can do. He is the one with the general liability policy. If they have chosen to deny his claim, that is between him and them.

I hope this helps
Richard Hixenbaugh