How Does Hired and Non Owned Auto Coverage Work?

There are several different types of auto insurance policies for drivers to choose from. Having a variety of potential options gives Canadian drivers the flexibility to find a plan that meets their:

• Budget
• Lifestyle
• Driving habits

In some cases, the ideal option is hired and non owned auto coverage. If you’re not familiar with this type of coverage or the benefits it offers, you can find out more below.

What is hired and non owned car coverage?

Hired non owned auto coverage (often referred to as HNOA coverage) is a specific type of auto insurance plan intended for drivers who use borrowed vehicles on a regular basis.

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Hired non and owned auto coverage protects the policy owner of the vehicle in the event of a car accident. It’s worth noting that the policy owner isn’t always the driver, but we’ll touch on that more shortly.

How does hired and non owned coverage work in Canada?

In Canada, hired non and owned auto coverage is reasonably similar to a standard car insurance policy. In the event of a vehicle-damaging accident, the policyholder gets financially covered.

The primary difference between the two is that traditional car insurance plans cover your vehicle, whereas hired and non owned coverage protects drivers in borrowed cars. This is an important factor to keep in mind while deciding if hired and non owned coverage is a practical choice for you.

Who should consider hired and non owned coverage in Canada?

There’s a long list of drivers that can benefit from purchasing hired and non owned coverage in Canada. Some of these individuals include:

Business owners

Do you own a business that requires employees to use rented or borrowed vehicles? If you answered yes, you might want to think about getting hired and non owned coverage for your business.

If one of your employees happens to get into an accident in a borrowed vehicle, then you (the policyholder) will be covered.

So, whether your employees are constantly using rented vehicles to see clients or rely on borrowed cars from time to time, hired non owned coverage is a safe and responsible investment in your business.

However, business owners need to remember that hired and non owned coverage only covers borrowed and rented vehicles, not company cars.

Employees that drive rented or borrowed vehicles for work

On a similar note, if your career requires you to drive borrowed cars, you should also consider purchasing non owned hired auto coverage. By doing this, you’ll protect yourself (and your wallet) on the road.

Drivers that rent cars regularly

Whether it’s for work, play or everyday tasks, there’s no denying that rental cars are convenient. Rental cars give you the freedom to travel while on vacation or while your vehicle is getting repaired.

Although most rental car companies offer a basic form of insurance, these plans tend to be expensive, especially when comparing the price to the lack of coverage.

If you want to feel confident in your new rental car, you should consider purchasing hired and non owned auto coverage. Doing this will ensure that you get reimbursed in the event of an accident (in which you get deemed not responsible).

Drivers that borrow cars from family or friends regularly

Certain auto repairs can take days or weeks to complete. Drivers that can’t afford to go that long without wheels often rely on their family or friends’ vehicles to get around.

If you’re planning on borrowing someone’s vehicle for a few days or weeks, you should think about purchasing hired and non owned auto coverage.

As mentioned above, if you don’t have the correct coverage while driving a borrowed car, your acquaintance will have to pay for the potential damage out of pocket.

Drivers that utilize car-sharing services

Much like rental vehicles, car-sharing services are excellent for people who need a temporary set of wheels. For those who’ve never used one, car sharing is a service that allows users to borrow vehicles for a short time.

Car sharing is different from renting due to the fact that rental companies have extensive collections (generally referred to as fleets) of vehicles to choose from — in contrast, car-sharing services let you borrow cars from people in your locale. 

Most car-sharing services offer rudimentary protection; however, if you want to ensure that you’ll be financially covered, you should opt for a hired or non owned auto plan.

Do all drivers need hired and non owned auto coverage?

Simply put, no, not all drivers will necessarily need this type of coverage. Some examples of drivers that likely don’t need hired and non owned car coverage include:

• Drivers who own their vehicle - Drivers who own a car need to have traditional car insurance but won’t benefit from hired and non owned car coverage.
• Drivers that share vehicles with someone in their household - Although hired and non owned coverage isn’t required, you should list yourself as a secondary driver on the owner’s policy.
• Drivers that borrowed cars occasionally - If you only borrow vehicles once in a while, there’s no need to worry about additional coverage.

How much does hired and non owned coverage cost in Canada?

It’s difficult for us to provide you with an exact answer, as the price varies from provider to provider.

In general, Canadian drivers can expect to pay approximately $50 a month for hired and non owned car insurance. However, we can tell you that the following variables will influence the total cost:

• Driving record
• Age (young drivers tend to pay more)
• Level of coverage (the more coverage you want, the more you’ll have to pay)

For more information about the price of hired and non owned coverage, be sure to reach out to your insurance agent.

Your insurance agent can give you a pinpoint answer as to how much you’ll have to pay on a monthly or yearly basis. Whatsmore, your insurance provider can also notify you if you’re eligible for any discounts for your current coverage, which could end up saving you a hefty chunk of change. Check also this post about OPCF 27.